
Copyright^ . 



COPYRIGHT DEPOSIT; 



BANK ORGANIZATION 



JOMN R. BAER 




IcIO 
SI K. KIT/TOWN. PA. 






Copyright, 1910, by 
The Author. 



£CU2806]8 



PREFACE. 

The author of this book d in the organization and 

ring of banks, and qu 1 to towns where 

organizers have been trying * a banking ini 

tion and failed, or, having have not §uc- 

d in making the venture a payin 
local men tail because th. nize, or 

ganized a banking institution where the bank has no possible 
chance for existence, either 1 the banl ilities are 

dy adequate in that town, or the field from which the new 
bank must draw it- patronage is t<»<i limited, or if the field is 
there, they may be trying to organize - ri]>e 

(the writer has watched t< the kank 

question was agitated before his judgment told him that the 
proper time to organize had arrived); or tin- failure ma 
attributed to wrong meth ids of ing. Tl three 

causes of failure ran not be explained awa) in any text-book, 
but must come with a judgment ripened b . btU for 

the purpose of pointing out not the only p ethod i 

ganizing, but the method which the author has us 
izing a large number of hank-, all of which are paying 
tions, this chapter on "ORGANIZATION OF BANKS" has 
been added to the anther'- book, *' My First Year i n Banki 
of which this is merely a reprint 

While mainly intended for the organization of Na1 
Banks, the system is also suitable for State Banks and Trust 
Companies — only while the National Banking Law- are. of course, 
uniform, each State ha- its own regulations for its hanking 
institutions, and the information concerning the legal require- 
ments will have to he secured from the proper authorities in 
the State in which you are organizing. 

Any points arising during the organization period that are 
not clearly brought out in this reprint will he cheerfully explained 
upon request. 

JOHN R. BAER. 
Corcoran Bldg., Washington, P. C. 

(iii) 



CONTENTS. 



Methods of ( Irg vnization. 

A— Conversion. 
B — Reorganization. 
C— Dc Novo (new bank 

The De Novo organization period r< 
natural divisions, viz : 

First.- Preliminary Steps Leadin ion. 

A — ( Organization De Novo (a new bank). 
B \ Formal application to the "Comptroller 01* the 
Currency," Washington, 1 1 

\rc Better Banking Faciliti< 1 ? 

Si * OND.— TEM POH ^RY < >RG \M/ KTH 

\ Formation of ( Organization Board 
I'. Qualifications f it 1 1 hip. 

C — Selecting I Krecfc >rs. 

r Subscription Blanks. 

Autographic I 

Price <>f Stock. 

D— Selling Stocks Prospectus. 

j Cash «»r Instalments. 
Payments I Temporary Certificates. 
(^ IV rmancnt Certificates. 

E— Formation oi Permanent Board of Directors. 
Third. — Perm \m:\t Organization. 

A — The Proper officials to Administer the "Oaths of 
Office" and to Receive " Acknowledgments." 
B — Articles of Association. 
C — Organization Certifies 
O — ( )aths oi Directors. 
E — Signatures o\ Officers. 

(V) 



vi BANK ORGANIZATION. 

Fourth. — Preliminary Work Preceding "Opening Day." 

A — Certifying to Payment of 50% on Bach Share of 
Capital Stock. 

B — Preliminary Examination by Special Examiner. 

C — Comptroller's Authority to Commence the Business 
of Banking. 

D— Charter. 

E — Publication of Charter and Oath of Publication. 

F — Reserve Agents. 

G — Purchasing U. S. Bonds and Ordering Circulation. 

H — Voting Powers of Shareholders. 

I — Your Washington Agents. 

J — By-Laws. 

Banking Room and Fixtures. 

Banking Room I Temporary Quarters. 
J Permanent Quarters. 

{Furniture and Fixtures. 
Vaults. 
Safes. 

The Sovereign States. 

States and Territories, and the proper officials to whom 
requests for information concerning the organiza- 
tion of State Banks should be addressed. 



DETAILED STEPS 



IN THK 



ORGANIZATION OF A NATIONAL BANK 



Are better banl 
i . Foi m.-ii application to tl 

Ington, i • C, for i- rml ■ a I 

2. i i<»w to iiii "in .1 ppiication t.. 

A. TEMPORARY ORGANIZATION. 

tlon "i "i mi board 

i. Beli ctlng «in ectoi 

:.. Selling stock . . 

•;. in., of stock, 

7. Mow payments 

s. Subscription n -t 

!». Temporary stock certificate 

j 0, i 'rospecl us . , , 

B. PERMANENT ORGANIZATION. 

ii. How to wind up the affairs of tempor Isatlon and form 

tiit- permanent organisation 

1 2. Executing organisation papers: 

1. Ai tides of ass. elation 66 

2. i irganisation certificate 

::. < >aths of dir.\ 'tors 

i. Certificate as to payment of capital stock *:. SS 

t 
5. < >rder for circulation 

»;. Signatures of officers 



136 BANK ORGANIZATION. 

C. PRELIMINARY WORK that will have to be attended 

to before opening for business. 

PAGE. 

1. Preliminary examination 02 

2. Publishing outhority to commence the business of banking. . 94 

3. Appointing reserve agents 102 

4. Purchasing U. S. bonds to secure circulation 102 

:>. ( Ordering your circulation 106 

6. Engaging your Washington agents 112 

D. BY-LAWS. 

Form of 114 



BANK ORG VNIZATK 7 

Election of Members and Officers of the Organization Board, 
Organizing the Bank of 

A MEETING OF THE ORGANIZATION BOARD 

held at on the d 

19 . . at . . . P. M.. in the office of 

Xo. . . 

Street. There were- present Messrs. .... 



Th 

organized by selecting Mr. 

as Chairman; Mr. 

as Vice Chairman ; Mr. . . . 

Secretary and as Treasurer. 

The officers of the Hoard were requested to forward their 

signatures to The 

as Depository. Adjourned to meet at 

on at 

p. m. or subject to call. 
Attest : 



Secretarv. 



8 BANK ORGANIZATION. 

Officers and Members of Organization Board, Organizing the 
Bank of 



Chairman . . 
Vice Chairman 
Secretary . . 
Treasurer . . 



MEMBERS 



VNIZATK 9 

Members and Officer of Permanent Board of Directors 
Appointed 

President 

Vice President 

Vice President ... 

President 

tary 

MEMBERS: 



It is always advisable to make three Vice Presidents, as this will .uive 
you an opportunity to distribute the officers among your country directors. 
thereby linking a Stronger chain between the hank and your future out-of- 
town patrons than if you kept all your officers confined to your home town. 



io BANK ORGANIZATION. 



METHODS OF ORGANIZING, 



CONVERSION— REORGANIZATION— DE NOVO. 
Conversion of State Banks. 

Section 5154, United States Revised Statutes, provides for 
the conversion of banks existing under State laws into National 
banking associations and reads as follows : 

Any bank incorporated by special law, or any banking institution 
organized under a general law of any State, may become a National as- 
sociation under this title by the name prescribed in its organization cer- 
tificate; and in such case the articles of association and the organization 
certificate may be executed by a majority of the Directors of the bank 
or banking institution ; and the certificate shall declare that the owners 
of two-thirds of the capital stock have authorized the Directors to make 
such certificate, and to change and convert the bank or banking institu- 
tion into a National association. A majority of the Directors, after 
executing the articles of association and organization certificate, shall 
have power to execute all other papers, and to do whatever may be 
required to make its organization perfect and complete as a National 
association. 

APPLICATION TO CONVERT A STATE BANK. 

The name of the place should form a part of the title, thus, " The 

First National Bank of A ," but the name of the State should 

not be included. 

Consideration will not be given to an application for a title includ- 
ing the word " First," if a National bank exsits or has existed at the 
given locality: nor to an application for a title identical with that of a 
National bank heretofore in existence, nor to one materially similar to 
that of a National, State, or other bank existing in the place. 

, 19—. 

To the Comptroller of the Currency, 

Washington. 
Sir: Notice is hereby given that we, the undersigned, being a major- 
ity of the Board of Directors of "The " having a paid 

in and unimpaired capital of $ , intend to convert the said bank 

into a National banking association, in accordance with the provisions 
of section 5154 of the Revised Statutes of the United States, under the 



BANK MIZATIO n 

Minutes of the Meeting cf Organization Board. 



12 BANK ORGANIZATION. 

title " The ," to be located at , county of r , 

te of , with capital of $ . 

We request that the title be reserved for a period of sixty days and 
the necessary conversion papers and instructions sent to , 

at . 



Signatures of Directors. 



Residences. 



When the applieation to convert has received the Comp- 
troller's approval, the shareholders should execute a form similar 
to the following, bearing in mind that at time of conversion there 
can be no change in amount of capital stock, par value of shares, 
or number of directors unless effected under State law prior to 
execution of papers other than application for authority to con- 
vert : 

AUTHORITY FOR CONVERSION OF STATE BANK. 

We, the undersigned stockholders of The , located in the , 

county of , State of , having a capital of dollars, do 

hereby authorize and empower the Directors thereof to change and con- 
vert said bank into a National banking association under the provisions 
of section 5154 of the Revised Statutes of the United States, or of acts 
amendatory thereof ; and we do also authorize said Directors, or a ma- 
jority thereof, to make and execute the articles of association and organ- 
ization certificates required to be made or contemplated by said statutes; 
and also to make and execute all other papers and certificates, and to do 
all acts necessary to convert the said bank into a National banking asso- 
ciation, and to do and perform all such acts as may be necessary to trans- 
fer the assets of every description and character of the said State bank 
to the National banking association into which it is to be converted, so 
that the said conversion may be absolute and complete ; and we do hereby 
assume, and authorize the said Directors to assume, as the name of the 
National banking association into which the said State bank is to be 

converted, " The ; " and we do hereby appoint , , 

, who are now the Directors or the said State bank, to be the Direc- 
tors of the said National bank, to hold their offices as such Directors until 
the regular annual election of Directors is held pursuant to the provi- 
sions of said Revised Statutes, and until their successors are chosen and 
qualified ; and we do hereby authorize the said Directors of the said 
National bank to continue in office the officers of the said State bank, or 
to appoint or elect others. 

In witness whereof we have hereunto set our hands and written 



K ORGANIZAT* 

Minutes of the Meeting of Organization Board. 



14 BANK ORGANIZATION. 

againsl our nanus the number of shares owned by us, respectively, this 
day of . A. D. . 



Signatures of Stockholders. 



No. of shares owned 
by each. 



After executing this paper the Directors of the State Bank 
have full powers to execute all papers incidental to the conver- 
sion of the hank into a National banking institution. 

Upon conversion the State Bank does not dissolve, but sim- 
ply changes title, and the newly formed National Bank assumes 
and is liable for all obligations and may enforce all contracts of 
the State Bank. 

The shareholders of the State Bank having authorized its con- 
version into a national banking association, the Directors should 
execute the " Articles of Association " and " Organization Cer- 
tificate " as per the following forms, the signatures of a majority 
of the Directors being required : 

ARTICLES OF ASSOCIATION. 
(Executed in Duplicate.) 

We, the undersigned, Directors of the , having been 

authorized by the owners of two-thirds of the capital stock of said bank 
to change and convert the said bank into a National banking association, 
under the provisions of section 5154 of the Revised Statutes of the United 
States, or of acts amendatory thereof, and to execute articles of associa- 
tion, do hereby, in our own behalf, and in behalf of the stockholders 
whom we represent, make and execute the following articles of associa- 
tion : 

First. — The title of the association into which the said State bank is to 
be changed and converted shall be "The .'' 

Second. — The place where its banking house or office shall be located, 
and its operations of discount and deposit carried on, and its general 
business conducted shall be the , county of , State of . 

Third. — The Board of Directors shall consist of share- 
holders. 

Fourth. — The regular annual meetings of the shareholders for the 
election of Directors shall be held at the banking house of this associa- 
tion on the second Tuesday of January of each year; but if no election 
shall be held on that day, it may be held on any other day, according to 
the provisions of section 5149 of the Revised Statutes of the United States, 
and all elections shall be held according to such regulations as may be 



VNIZATK 

Minutes of the Meeting of Organization Board. 



16 BANK ORGANIZATION. 

prescribed by the Board of Directors, not inconsistent with the provision 
of the National banking law and of these articles. 

Fifth. — The capital stock of this association shall be thousand 

dollars, divided into shares of one hundred dollars each; but the capital 
may. with the approval of the Comptroller of the Currency, be increased 
at any time by shareholders owning two-thirds of the stock, according 
to the provisions of an act of Congress approved May I, 1886; and in 
case of the increase of the capital of the association, each shareholder 
shall have the privilege of subscribing for such number of shares of the 
proposed increase of the capital stock as he may be entitled to, accord- 
ing to the number of shares owned by him before the stock is increased. 

Sixth. — The Board of Directors, a majority of whom shall be a 
quorum to do business, shall elect one of its members president of this 
association, who shall hold his office (unless he shall be disqualified, or 
be sooner removed by a two-thirds vote of all of the members of the 
board) for the term for which he was elected a director. The directors 
shall have power to elect a vice-president, who shall also be a mem- 
ber of the Board of Directors, and who shall be authorized, in the ab- 
sence or inability of the president from any cause, to perform all acts 
and duties pertaining to the office of president, except such as the presi- 
dent only is authorized by law to perform, and to elect or apopint a 
cashier and such other officers and clerks as may be required to trans- 
act the business of the association ; to fix the salaries to be paid to them 
and continue them in office, or to dismiss them, as, in the opinion of a 
majority of the Board, the interests of the association may demand. 

The directors shall have power to define the duties of the officers 
and clerks of the association ; to require bonds from them and to fix 
the penalty thereof ; to regulate the manner in which elections of Direc- 
tors shall be held, and to appoint judges of the elections; to make all 
by-laws that it may be proper for them to make, not inconsistent with 
law, for the general regulation of the business of the association and the 
management of its affairs, and generally to do and perform all acts that 
it may be legal for a Board of Directors to do and perform under the 
Revised Statutes aforesaid. 

Seventh. — This association shall continue for the period of twenty 
years from the date of the execution of its organization certificate, un- 
less sooner placed in voluntary liquidation by the act of its shareholders 
owning at least two-thirds of its stock, or otherwise dissolved by author- 
ity of law. 

Eighth. — These articles of association may be changed or amended 
at any time by shareholders owning a majority of the stock of the asso- 
ciation in any manner not inconsistent with law; and the Board of Direc- 
tors, or any three shareholders, may call a meeting of the shareholders 
for this or any other purpose not inconsistent with law by publishing no- 
tice thereof for thirty days in a newspaper published in the town, city, or 
county where the bank is located, »r by mailing to each shareholder notice 
in writing thirty days before the time fixed for the meeting. 



>RG VNIZ \'l'i 

Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 

In witness whereof we have hereunto set our hands this day 

of . 



ORGANIZATION CERTIFICATE. 

We, the undersigned Directors of the , having been duly 

authorized by the owners of two-thirds of its capital stock to change and 
convert said bank into a National banking association, and to make the 
necessary organization certificate, under the provisions of section 5154 
of the Revised Statutes of the United States, or of acts amendatory there- 
of, do sign and execute the following organization certificate, which we 
hereby declare we are authorized to make by the owners of two-thirds of 
the capital stock of the said State bank. 

First. — The title of this association shall be " The ." 

Second. — The said association shall be located and continued in the 
of , county of , and State of ,* where its opera- 



tions of discount and deposit are to be carried on. 

Third. — The capital stock of this association shall be dollars 

($ ), divided into shares of dollars each, as it is now 

divided in the said State bank. 2 

Fourth. — The name and residence of each of the stockholders of the 
said State bank, which is to become a National bank under the provisions 

of the Revised Statutes aforesaid, and the number of shares of 

dollars each held by each stockholder ars as follows : 



Residence. 



No. of shares. 



Fifth. — The certificate is made in order that the said State bank and 
the stockholders thereof avail themselves of the advantages of the afore- 
said Revised Statutes, and that the said State bank may be changed and 
converted into a National banking association under the foregoing title. 

In witness whereof we have hereunto set our hands this day 

of . 



The signatures of a majority of Directors required. 



If Bank nas branch or branches add after the worJs State of " with branch 



2 If Bank has blanch or branches add "of which amount > has been assigned 

and trarsf erred to the branch at ." 



19 

Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 



Statf of 



County of . ss: 

Before the undersigned, a of , personally appared 



Directors of the aforesaid State bank, to me well known, who severally 
acknowledged that they executed the foregoing certificate for the pur- 
t herein mentioned. 
Witness my hand and seal of office this day of . 

[OFFICIAL SKAI, OF OFFICER.] . 



CERTIFICATE RELATIVE TO PAYMENT OF CAPITAL STOCK OF 
STATE BANK CONVERTING INTO NATIONAL BANK. 

It is hereby certified that the Bank of , 

which is to be converted into " The National Bank of 

," in conformity with the provisions of section 5154 of the Revised 

Statutes of the United States, authorizing the conversion of " any bank 
incorporated by special law or any banking institution organized under a 
general law of any State," has a paid in and unimpaired capital of $ . 

President. 

or 



Cashier. 



State of , 

County of , ss: 

Subscribed and sworn to before the undersigned, a of the said 

county, this day of , 19 — . 

[official seal of officer.] . 

[Office.] . 

Duly qualified Directors of a State Bank being converted 
into a national bank may continue as directors, regardless of the 
number of shares owned, until the first annual election is held 
when, to be eligible for reelection, they must own the number of 
shares required by the national bank act. The oaths should be 
taken as directors of the national bank. Unless officers are re- 
appointed by the directors of the national bank subsequent to 
their qualification, the form requiring the signatures of the of- 
ficers of the national bank (a copy of which follows ) should show 
date of appointment by the directors of the State bank : 



K ORG tNIZATK 21 

Minutes of the Meeting of Organization Board. 



22 BANK ORGANIZATION. 

OFFICIAL SIGNATURES. 

Official signatures of the president, vice-president, cashier, and assist- 
ant cashier of the National Bank, located at , appointed at 

a meeting of the Hoard of Directors of the State Bank, held on 

the day of . 19 — . 

[SEAL of BANK.] , President. 

, Vice-President. 

, Cashier.. 

, Assistant Cashier. 

Branch Banks. 

The only provision in the national bank act relating to branch 
banks is found in section 5155, United States Revised Statutes, 
and reads as follows : 

It shall be lawful for any bank or banking association, organized 
under State laws and having branches, the capital being joint and as- 
signed to and used by the mother bank and branches in definite proportions, 
to become a National banking association in conformity with existing laws, 
and to retain and keep in operation its branches, or such one or more of 
them as it may elect to retain. * * * 

The granting of this special privilege to State banks and the 
absence of any similar provision in the law with respect to banks 
of primary organization have always been construed by the Comp- 
troller to imply that banks of the latter class were not permitted 
to have branches. The section cited absolutely restricts branch 
banks of converted associations to such as have a definite pro- 
portion of the capital of the parent bank assigned to them, and 
it is not to be assumed that the law contemplated that the asso- 
ciations of primary organization should be permitted to assign 
any portion of their capital to and operate branches. 

REORGANIZATION. 

A State bank can liquidate, then reorganize itself into a Na- 
tional bank, the bank then purchasing the approved assets of the 
liquidated association. The capital stock must be represented 
by nothing but actual cash, and if the capital of the bank to be 
converted does not comply with the requirements of the U. S. 
Hank Act, it must be made to conform before conversion can 
be effected. 



BAN 23 

Minutes of the Meeting of Organization Board. 



24 * BANK ORGANIZATION. 

Conversion of Private Banks. 

The law is silent so far as the conversion of private banks 
is concerned; therefore, the only safe plan is by liquidating and 
reorganizing. 

ORGANIZATION DE NOVO. 

(Organizing a New Rank.) 

Formal Application to the Comptroller of the Cur- 
rency, Washington, D. C. 

THE 1'IVK (5) original applicants. 
(Sect. 5133, U. S. R. S.) 

After not less than five of the representative citizens of a town 
have decided to organize a National bank, the first thing to do 
is to write to the Comptroller of the Currency, Washington, D. 
C, asking for an application blank. 

(The writer uses the following form letter.) 

To the Comptroller of the Currency, 

Washington, D. C. 

Sir: This town being in need of better banking facilities, a meeting 
was held and the banking needs of the town discussed, and it was decided 
to organize a National Bank. 

Kindly mail application blank to 



vState Banks and Trust Companies, as a rule, do not require any appli- 
cation blanks. 

Upon receipt of your letter at Washington, the following 
application will be mailed to you : 

application to organize a national bank. 

The name of the place should form a part of the title, thus, " The 

First National Bank of A ," but the name of the State should not 

be included. 

Consideration will not be given to an application for a title including 
the word " First " if a National bank exists or has existed at the given 
locality; nor to an application for a title identical with that of a National 
bank heretofore in existence, nor to one materially similar to that of a 
National, State or other bank existing in the place. 

The application must be signed by at least live prospective share- 
rs and should be indorsed by three prominent persons, judge of 
conn, postmaster, and mayor or other public officials. 



BANK ORGANIZATIi 

Minutes of the Meeting of Organization Board. 



J 6 



BANK ORGANIZATION, 



19 



To the Comptroller of the Currency , 

Washington. 
Sir : 

Notice is hereby given that we, the u?idersigned, being natural 
persons, and of lawful age, intend, with others, to organize a Na- 
tional Banking Association, under the title of "TJie 

\SsU**L**b£ f to be located 

at- , County of- , 

State of - _. , with capital 

of $ kSf?.w?Jf.MJ). , to succeed the \§& ****.*!?.:$. bank 

of Population, 

We request that the title be reserved for a period of sixty days, 

and organization blanks and z?istr7ictio?is sent to 

at 



(See Note No. 4) 



Signatures of applicants. 


Residences. 


Business. 


Financial strength 
in figures. 

















































The signers of this application are known by me to be reputable citi- 
zens ; the information in reference to their business and financial stand- 
ing is in my opinion correct ; the statement as to population authentic, 
and I am of the belief that the conditions locally are such as to insure 
success if the bank is organized and properly managed. 

: , [udge of Court. 

, Postmaster . 

, Mayor. 



BANK 

Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 
NOTE ONE— THE TITLE— NATIONAL BANKS. 

The name of the town must be a part of your title, i. c, " The 

Xew Tripoli National Bank," " The Farmers' National Bank of 
Kutztown," but adding the name of the town as " The Kutztown 
National Bank of Kutztown," the " of Kutztown " being super- 
fluous, would not be allowed. 

Make the title as brief as possible. The writer knows where 
the Department took exception to unduly long and vague titles. 

You can not get the title "The First National Bank of 

if at any time previous to your organization there had been a 
bank of that title, nor can you have any title that might lead the 
public to confuse your institution with that of any other bank. 

A great deal of useless correspondence can be avoided if 
you decide definitely upon your bank's title before filling in your 
application blank. Do not, after the organization is practically 
completed, decide to change the name. You will always find the 
Comptroller willing to oblige you whenever he can do so, yet 
if you stop to consider that your bank is but one of a great 
number being organized at that particular time, you will feel 
more like doing away with all unnecessary complications. 

THE TITLE— STATE BANKS. 

State laws do not, as a rule, require the names of towns to 
be a part of the corporate title. 

NOTE TWO— CAPITAL STOCK— NATIONAL BANKS. 

The minimum amount must be $25,000 and this only in 
places of 3000 population or less. In places of 6000 or less the 
minimum capital must be $50,000, if less than 50,000 the capital 
must be $100,000, and all places over 50,000 the capital must be 
not less than $200,000. 

CAPITAL STOCK— STATE BANKS. 

States vary in their capital stock requirements, and the de- 
sired information must be secured from your State Banking 
authorities. 

NOTE THREE. 

Fill in the name of the party who is acting as the Secretary 
of your Organization Board. 



K ORGANIZATK 
Minutes of the Meeting of Organization Board. 



jo BANK ORGANIZATION. 

ARE BETTER BANKING FACILITIES NEEDED? 

In order to provide against the organization of unnecessary 
banks, and to keep in cheek those who are in the business of 
promoting banks, the Government will not grant you permission 
to organize unless you can show just reasons for the same — the 
writer reprints a copy of a letter of inquiry such as is mailed by 
the Comptroller to the original petitioners for permission to or- 
ganize, and upon the answers received to these letters and the 
later examination made by some accredited party designated by 
the Department, depends the final action and seals the fate of 
your petition. 

Treasury Department. 

Washington, D. C, , 19 — . 

Air. , 



Sir: 

An application signed by you and others has been received; 

dated , for authority to organize " The First National 

Uank of ," capital $25,000, the request being made that 

blanks for the organization of the bank be mailed to , 



For your information it may be stated that it is the policy 
of the Comptroller not to permit of the organization of a bank 
in a village or town where the deposits which would naturally 
come to it from the surrounding community will not be such as 
to sustain a prosperous and profitable bank. You are requested, 
therefore, to promptly advise this office whether you have given 
the case due consideration and are reasonably certain that there 

is sufficient business at , and local conditions are 

such as to insure success if the bank is organized and properly 
managed. 

Please advise whether the demand for banking facilities 

at originated with the signers of the application or 

some corporation or persons engaged in promoting the organiza- 
tion of national banks. 

Upon receipt of reply to this letter, approval of the appli- 
cation will have consideration. 

By direction of the Comptroller. 
Respectfully, 



Chief, Organization Division. 



Minutes of the Meeting of Organization Board. 



32 BANK ORGANIZATION. 

If upon due and impartial examination the Comptroller 
approves oi your application, he will so advise you and furnish 
all necessary blanks, with full instructions for their proper exe- 
cution, and you are then ready to begin active work, and you 
will be granted 60 days in which to complete your organization. 
You can, however, receive an extension of time if you find that 
the allotted time is not sufficient to complete your organization. 

Your application having been granted and your papers and 
instructions received, your next step will be to appoint your 

ORGANIZATION BOARD. 

The five original petitioners should add to their number such 
men of prominence as they can interest in the project, and the 
writer does not add to his organization boards any person who 
does not contemplate standing for the directorship, so the sug- 
gestions found under the caption " Selecting Your Directors " 
should be taken in conjunction with this article. 

NUMBER OF AND QUALIFICATIONS FOR DIRECTOR- 
SHIP—NATIONAL. 

Sect. 5145, R. S., places the minimum number of directors at 5, 
there being no maximum, and Sect. 5146, R. S., provides that each 
director must own in his own right at least 10 shares of stock if 
the capital of the bank is over $25,000, otherwise he must own 
at least five shares. That at least three-fourths of the directors 
must have resided in the State or Territory in which the bank 
is located for a year or more preceding their election, and must 
be residents therein during their continuance in office. 

That no part of the stock held by a director shall be pledged 
in any manner. 

NUMBER OF AND QUALIFICATIONS OF DIRECTOR- 
SHIP—STATE. 

No uniform requirements. 

SELECTING DIRECTORS. 

Before you should attempt to sell any shares in your institu- 
tion, you should make up a " Temporary Board of Directors," 



33 
Minutes of the Meeting cf Organization Board. 



34 BANK ORGANIZATION. 

known as the "Organization Board," the same to become the 
'■ Permanent Board of Directors" when your "Articles of In- 
corporation " have been duly executed. By " Articles of [ncor- 

tion is meant the "Articles of Association" and "The Or- 
ganization Certificate," as the date of the latter determines the 
date of the " Organization Board's " becoming a body corporate. 

Your Board should consist of the most conservative men in your 
locality. Men who are held in the highest esteem, for your bank 
:. be judged by the standing of the men comprising its Hoard; 
and do not forget that the possession of mere wealth is not neces- 
sarily a safe criterion to go by while judging a man's qualifica- 
tions for a directorship, for a man who has acquired several 
thousand dollars by his own unaided efforts, is often more worthy 
of respect than the man who merely inherited a fortune that 
somehody else had accumulated. 

Try and get men who have made a success of their own 
business, and get representative men from various lines of busi- 
ness, thereby diversifying- the business interests of your town, 
for if you get too many of one and the same business on the 
board, your bank may be nick-named after that particular busi- 
ness. The writer has known of one bank that had five landlords 
on its hoard and the bank was called the " Hotel Keepers' Bank," 
and in spite of everything they could do, the name stuck until 
the}' removed three of the hotel men and substituted others. 
Remember, it is the personality of the man that counts, and not 
his money; therefore, go slow and be sure and get the strongest 
man in each locality. And right here let me tell you, do not 
place too many of your townsmen on your board, but take your 
map and draw a circle clean around your town, then pick out 
the locations from which you can reasonably expect to draw 
your business and place your directors there ; in this manner 
complete the circle, and by so doing you will concentrate the 
business and draw it to your town, which is one of the main 
reasons that prompted you to organize. 

• SELLING STOCK. 

Having filled your Organization Board and thereby selected 
your future directors, you are now ready to secure subscriptions 
to your capital stock. Make each one of your directors a nu- 
cleus around which to sell vour shares, allowing each director 



Minutes of the Meeting of Organization Board. 



36 BANK ORGANIZATION. 

to give you his own list of probable shareholders in his terri- 
tory and restrict your shareholders to those whose names you 
find on these lists, and by the time you have completed the cir- 
cle von will find your shares all sold and every share thus sold 
will represent future business, for by selling- along- these lines 
you will not sell any shares to those who would buy simply for 
the sake of safely investing their surplus cash, but to those 
who, having the welfare of the bank at heart, will not only be- 
come depositors themselves, but will influence as many others as 
they can. 

Follow this plan faithfully and you will be surprised at 
the result, as many years' experience has fully proven the wis- 
dom of this course. 

By following the above plan the writer's company often suc- 
ceeds in getting from 75 to 200 shareholders for a $25,000 or 
$50,000 bank. 

SUBSCRIPTION LIST. 

The Bank Act does not provide for the filing of a list of 
the subscribers to the Capital Stock of a National Bank, there- 
fore no blank subscription list is furnished by the Government. 

USUAL FORM OF SUBSCRIPTION PAPER. 

We, whose names are hereunto signed, do hereby subscribe, in the 
proportion hereunto set opposite our respective names, for the stock of 
a National Banking Association to be organized under the laws of the 

United States with a capital stock of thousand dollars, divided 

into shares of a par value of One Hundred Dollars each, the said 

National Banking Association to be located in the of State 

of , and to be called " The . 



Signatures. 



Residence. 



Shares. 



37 
Minutes of the Meeting of Organization Board. 



38 BANK ORGANIZATION. 

The writer prefers and uses the following individual subscription form 



^Yo. APPLICATION FOR SHARES IN 

THE FARMERS' NATIONAL BANK 

OF NEW TRIPOLI, PA. 

To the Organisation Board for the Proposed Bank: 

I subscribe for shares of the Capital Stock in a bank to be organ- 
ized by you according to law and agree to pay for same by monthly payments as 
called for by your Organization Board or the Directors. 

I agree that the amount of the Bank's Capital is to consist of all the shares sold 
and will be at least the minimum authorized here by law. Kach share sold shall be 
issued at 5125.00, of which par value is $100 and $25, a subscribed premium, is for un- 
divided profits, part of which you may use for an Organization Fund to purchase 
books, checks and supplies and pay legal and other expenses incidental to organiza- 
tion and for securing the bank's capital, as agreed by the Organization Board, a quo- 
rum of which is authorized to act as my attorneys-in-fact in all affairs ielating to 
securing subscriptions, organization and charter, and apportioning shares. This sub- 
scription is made in connection with the subscriptions of others for the same object, 
on the same terms. I understand no person has authority to vary or waive printed 
terms on this paper or your agreement with depository. 

I pay $ b\- check or mone3- herewith as evidence of my good faith. 

Witness my hand and seal this day 

of 1909. 

WITNESS : [SEAIv] 

Name in full. 



P. O. Address 



4J^- Please pay $5 a share on subscription to Secretary of Organization Board 
when making subscription. Make Check payable to Collegeville National Bank. 
Collegeville, Pa. 



ORGANIZATION BOARD FOR 

THE FARMERS' NATIONAL BANK 

New Tripoli, Pa., 190 

Received of Mr. — - 

-for the first payment 4/ Five Dollars on each of. 

shares of stock at $125 a share t subscribed in this proposed Bank, 
payable in mo?ithly itistalments, as called for by the Organiza- 
tion Board or the Directors. 

$. Secretary. 



Minutes tf the Meeting of Organization Eoard. 



40 BANK ORGANIZATION. 

This individual form is preferable, for as you notice the 
money collected on subscription is placed on deposit in a national 
bank for safe keeping, instead of into the hands of one of the 
members of the organization hoard or the promoter. This 
makes the selling of the stock much easier, as it insures the 
subscribers of the safety of their funds and they feel perfectly 
safe, knowing that if for any reason the bank fails to organize, 
they will have all their money returned to them. 

" This Individual Subscription Form is not a legal form, nei- 
ther is the Organization Board as yet a legal body, therefore, you 
can not hold any subscriber who at this time wishes to withdraw 
his subscription." This is the writer's contention, although some 
authorities claim that all subscribers can be held liable; how- 
ever, it does not not pay to contend with would-be subscribers, 
as you will find that the shares will sell readily enough and you 
can not afford to make any enemies for the new institution, so 
it is the writer's unfailing policy that whenever any subscriber 
asks to have his subscription paper returned, to do so without 
any hesitancy whatsoever. 

However, after the Board becomes a body corporate, which 
will be just as soon as the "Articles of Association" and 
the "Organization Certificate" have been duly executed (Sec- 
tion 136 R. S. ) and the Directors have accepted the subscription 
by issuing the subscriber's certificate, offering him an oppor- 
tunity to vote his stock ; then the subscription being recognized, 
the subscriber is bound for payment, if the Board wishes to 
hold him. 

AUTOGRAPHIC LIST. 

You will find an " Autographic List," such as is shown be- 
low of material assistance in selling your stock, as it helps to 
inspire the would-be subscriber with confidence in the project 
to see the signatures of the officers and the seal of the National 
Hank vouching for the comparative safety of the funds during 
the organization period. 

This list was suggested by Mr. I v . O. Davis, of L,an caster, Pa., the wri" 
ter's partner in the organization of banks. 



B W 
Minutes of the Organization Board. 



4- 1 



BANK ORG WlZA'i'IOX. 



Concern :- 

. fui*da of 



: 






+S*~/\A 




B W'K IIZ \TI<).\\ 

Minutes of the Meeting ({ Organization Board. 



44 BANK ORGANIZATION. 

PROSPECTUS. 

The author's firm issues weekly prospectus and finds that 
it pays. Mail same to every name on your P. ( ). list, and when 
you come to sell them shares in your bank, they will know all 
about the proposition. 



THE FARMERS' NATIONAL BANK OF McALLISTERVILLE, PA. 

ORGANIZING. 



The Business Men and other Citizens of McAllisterville and vicinity who are 
organizing "The Farmers' National Bank," desire to express their sincere appre- 
ciation of the splendid support and encouragement they have received. The or- 
ganization is daily receiving added support from merchants, farmers, and thrifty 
citizens generally, who believe a National Bank will be a valuable business aid to 
the community and that its stock is an ideal investment both for security and profit. 

The growth of the movement is evidenced by the way the subscriptions are 
pouring in and the size and enthusiasm of the Thursday evening meetings, which 
have already outgrown the original meeting place and forces us into a larger 
room, where each meeting night some subject referring to "Banking and Its 
I,aws " will be discussed. 

Shares will be sold at $110 each. Subscribers are expected to pay 55 per share 
when making subscription, the balance to be paid as follows : $15 per share June 
15th ; S40, July 5th ; $10, August 16th ; $10, September 15th ; fio, October 15th ; $10, 
November 15th ; Sio, December 15th. 

The men interested decided to have a National Bank, chiefly because of the 
known conservatism and success of these institutions, which are under the strict 
supervision of the U. S. Government Officials, who keep in touch by frequent cer- 
tified reports of the condition of the bank and by personal examinations made by 
the bank examiners. The National law provides safeguards for depositors and 
stockholders. Every stockholder is entitled to vote at the stockholders' meetings 
of the bank, and all will be kept advised as to the condition and progress of their 
institution. 

Bank stocks steadily increase in value, and are in such demand by conserva- 
tive investors that it is generally impossible to obtain them, except by paying a 
large premium, unless secured at the time of bank organization, and such oppor- 
tunities are few. 

Anyone wishing to subscribe for shares should maks check for the first install- 
ment of $5 per share payable to M. I,. KNOUSE, Treasurer, and mail the same to 
1,. O. Davis, Secretary, McAllisterville, Pa. 

Further information or application blanks* may be procured from any of 
the following named members of the Organization Board : 

J. A. Yakkers, President- Sylvester Arnold, 

T. T. Davis. Jacob Bay, 

Henry Brown, M. Iy. Knouse, Treasurer, 

Wm. Lauber, Christian Benner, 

John H. SHELLENBERGER, H. A. Beyer, 

Wm. H. SlEBER, George Watts. 

L,EO SHELLENBERGER. 



PUBLIC BANK MEETINGS. 



&v°- Every Thursday Evening at eight (S) o'clock there will be held in the 
School Douse at McAllisterville, public meetings at which banking topics will 
be discussed. All are invited to attend and take part in the discussions. A 
special invitation is extended to the ladies. 



K ORGANIZAT* 

Minutes of the Meeting of Organisation Board. 



BANK ORGANIZATION 



A NEW BANK FOR KUTZTOWN 

ORGANIZING 



A number of the Business Men and Farmers substantially interested 
gress and welfare of Kutztown, Pa., and vicinity, have asso- 
ciated themselves for the purpose of organizing a second bank, to be 
in Kutztown. 

Tiie rcast n for this is, first, that another bank, operated by business 
nun along progressive lines, will be the means of upbuilding trade and 
industry here to the .ureal advantage of those who own property or are 
d in business in this section. At the same time the organizers 
believe that a second lank in this community operated by leading busi- 
ness men and farmers on approved co-operative principles, will receive 
patronage, and, in addition to paying the usual cash dividends 
anks, there will be an excess of proiits that will each year 
substantially increase the surplus and undivided profit fund of the bank. 
This bank will be controlled by carefully selected local men of known 
business ability. 

The men interested have for some time been contemplating this move 
and have met several times to consider matters pertaining thereto. They 
have employed John R. Baer and L. O. Davis to assist them in the work 
of placing the shares and getting the bank fully organized. Messrs. Baer 
and Davis were formerly in the employ of the Manhattan Trust Security 
C< i., i f Philadelphia, and assisted in organizing banks at Fleetwood, Bern- 
ville, Hamburg, Mohnton and Oley, all in Berks count} - , besides assisting 
at a number of towns in adjacent counties. 

Bank stocks steadily increase in value, and are in such demand by 
conservative investors that it is generally impossible to obtain them, ex- 
cept by paying a large premium, unless secured at the time of bank or- 
ganization, and such opportunities are few. Every stockholder is en- 
titled to vote at the stockholders' meetings of the bank, and all will be 
kept advised as to the condition and progress of the institution. Whether 
or not the charter shall be applied for under the federal or state juris- 
diction will be decided at a later date. 

There will be five hundred shares of stock offered to the public. 
Every share will be sold at the uniform price of $125 each, of which the 
first instalment of $5 a share is payable with the subscription. The bal- 
ance will be due as called for by the Organization Board and will prob- 
ably be payable as follows: $15 April 1st: $45 May 1st: $12 June 1st; 
$12 July ist; $12 August 1st; $12 September 1st; $12 October 1st, of 
which subscribers will be duly notified by mail. The bank may open 
for 1 usiness when $65 per share has been paid in. 

Person desiring to subscribe for shares will please make check for 
- f instalment of $; a share payable to order of The First National 
Bank of Fleetwood, which has been selected as the temporary depository 
for the funds, and mail check to L. O. Davis, Secretary, Box 20, Kutz- 
town. Pa. 

For further information sec either Mr. Baer or Mr. Davis at the 
Keystone House, or any of the following members of the Organization 
Board: 

CHAS. W. MILLER, T. F. ZIMMERMAX, 

JOHX A. SCHWOYER, D. L. NICKS, 

DR. X. Z. DUXKELBERGER. ARTHUR BONNER. 






Minutes cf tl Meeting cf Or n Ecard 



48 BANK ORGANIZATION. 



THE CLEARSPRING BANK 

CLEARSPRING. MD. 

HALF THE SHARES DISPOSED OF 

The gentlemen who have banded themselves together for the purpose of or- 
ganizing the Clearspring Hank are very highly gratified at the unusual progress 
that is being made in effecting the organization ; the shares are rapidly being sub- 
scribed for by our best citizens and all present indications more than seem to show 
that the shares will be held by a large number of the citizens of Clearspring and 
immediate vicinity. This method of distributing the shares in small blocks 
amongst a large number of holders foreshadows the future success of the bank, 
for it is only reasonable to suppose that those who purchase shares in the bank 
will favor it with their influence and patronage. 

The Organizers are especially pleased at the progress being made, because 
they are thoroughly convinced that a local bank, operated by business men along 
progressive lines, will be the means of upbuilding trade and industry in Clear- 
spring to the great advantage of those who own property or are engaged in busi- 
ness in the town or community. At the same time they believe that a bank in 
Clearspring operated by leading business men and farmers on approved co-oper- 
ative principles, will receive a large patronage, and in addition to paying the 
usual cash dividends of prosperous banks, there will be an excess of profits that 
will each year substantially increase the surplus and undivided profit funds of the 
bank. This bank will be controlled by carefully selected local men of known 
business ability 

Bank stocks steadily increase in value, and are in such demand by conser- 
vative investors that it is generally impossible to obtain them, except by paying a 
large premium, unless secured at "the time of bank organization, and such oppor- 
tunities are few. Every shareholder is entitled to vote at the shareholders' meet- 
ings of the bank, and all will be kept advised as to the condition and progress of 
the institution. Whether or not the charter shall be secured under the federal or 
state jurisdiction will be decided at a later date. 

There will be two hundred and fifty shares offered to the public. Every 
share will be sold at the uniform price of Si25each, of which the first installment 
of $5 a share is payable with the subscription. The balance will be due as called 
for by t ;e Organization Board and will probably be payable as follows: $15, Dec. 
15th; f40, Jan. 15th, 1910; J13, Feb. 15th; $13, Mar. 15th; $13, April 15th; $13, May 
15th; 13, June 15th. 

The Harrisburg National Bank, Harrisburg, Pa>. has been selected to act as 
depository for the first .-5 per share. In case the Clearspring Bank fails to orga- 
nize the amount paid by subscribers will be returned to them by said bank. 

Persons desiring to subscribe will please make check for the first install- 
ment of f5 per snare, payable to the Harrisburg National Bank and mail or hand 
check to Baer & Davis, Clearspring. Md., (Potomac House, or hand to any of the 
following interested persons, from whom further information may be secured: 

GEO. T. PRATHKK N. E. FUNKHOUSER, 

G. HOWARD SMITH, W. S. CORBETT. 

FRANK A. SEIBERT, DAVID R. SMITH, 

CHARGES SMITH. JACOB ANKENY, 

HENRY HELSER. JOS. A. SEIBERT, 

DANIEL SEIBERT, W. W. SEIBERT, 

JOHN F. SOWERS. DR. A. SHANK. 



PUBLIC BANK MEETING 



On Saturday evening at 7.30 o'clock, a public meeting will be held in 
the Odd Fellows' Hall, at Clearspring, at which meeting BANKING 
TOPICS will be discassed and any information asked for concerning 
banking will be given. MEETING OPEN TO ALL. A special invitation 
is extended to the ladies. 



49 

Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 



Adv. No. 4 July 29th 

The First National Bank 

OF BORDENTOWN, NEW JERSEY 

ORGANIZING 



151 SUBSCRIBERS! 

The Business Men and other citizens of Bordentown who are organ- 
izing the First National Bank desire to express their sincere apprecia- 
tion of the splendid support and encouragement they have received. The 
organization is daily receiving added support from merchants, farmers 
and thrifty citizens generally, who believe the First National Bank will 
be a valuable business aid to the community, and that its stock is an 
ideal investment, both for security and profit. 

That the movement grows is shown by the subscriptions in hand as 
follows: Jul)- 15th, 62 subscriptions; July 22d, 106, and July 29th, 151 
subscriptions. Of the 500 shares allotted to Bordentown, only a small 
number remain unsold and the 250 allotted to the adjoining territory are 
being rapidly taken in small subscriptions by farmers, merchants and 
others, so that the balance of the stock is expected to be held by about 
200 shareholders, thus assuring the popularity and support of the National 
Bank after it opens for business about the middle of October. 

Those desiring to secure shares should do so at once. This will be 
a home Bank, owned, directed and officered by home people. Xo person 
may subscribe for more than 10 'shares, and every stockholder is entitled 
to vote at meetings of the stockholders. 

Every share is issued and sold at the uniform price of $125, and is 
payable 35 a share with subscription for the July payment and sub- 
scribers will be notified by mail in due time afterwards of the remaining 
payments as follows: August 15th, $10; September 15th, $10; October 
15th, Sj.o; November 15th, $12; December 15th, $12; January 15th, $12; 
February 15th, $12, and March 15th, $12. 

Persons desiring to subscribe will please make check for the first 
instalment for $5 a share payable to " First National Bank of Trenton," 
the temporary depository for funds, and they may leave same at the tem- 
porary office in the W. C. T. U. library room over Beatty's grocery. In- 
formal ion will be cheerfully furnished at the office, or by any of the un- 
dersigned subscribers : 

Frkdkrick J. Potter, George L. Robbins, Joseph L. Osmond, 

James T.wtc.m, John Kenner. James S. Gilbert, M. D., 

Samuel E. Burr, Harrison G. Wright, Jacob Holzbaur, 

David R. Brown, Wm. McK. Morris, Samuel Robinson, 

William Warrack, Charles E. Burr, A. M. Parker, 

George F. Deacon, Walter Fosbrook, S. F. Garrison, 

Frank K. IIou.oway, William E. Warner, Joseph R. Deacon, 

Joshua Emory, Frank T. Buchanan, And Others. 

Or, address Secretary OF Organization Board, P. O. Box 383, Bor- 
dentown, X. J. Interstate 'phone, 120. Subscriptions received at office, 
or by solicitor, L. O. Davis. 



Minutes of the Meeting of Organization Board. 



52 • BANK ORGANIZATION. 

TRICE OF STOCK. 

The law requires that the Capital Stock of a National Bank 
shall he paid in cash at par ($100), but the Organization Board 
has a perfect right to ask that a premium be paid for the stock. 
The writer always prefers his Board to ask at least $125.00 per 
share, $100.00 being the par value of the stock of all National 
lianks and the $25.00 is credited to the Undivided Profit Fund 
and after the expenses of organizing are deducted, the balance 
is placed in the Surplus Fund, for if the bank starts with a sur- 
plus of 25%, then at first distribution of dividends the net earn- 
ings can all be distributed, if it is so desired, and while this would 
not be considered good banking, yet the writer has seen condi- 
tions when it paid the bank very well to do so. 

HOW PAYMENTS ARE TO BE MADE. 

The usual custom is to allow stock to be paid for in instal- 
ments, although it is an open question whether the law makes 
same compulsory, yet the instalment plan is the best plan, for it 
will allow you to secure a larger number of subscribers for your 
stock. It is nothing unusual for the writer's solicitors to se- 
cure from 75 to 200 subscribers for a $25,000 or $50,000 bank. 

When subscriptions to stock are paid for in instalments, 
" Temporary Certificates ought to be issued, and the amount of 
payments credited thereon upon full payments having been made 
and the surrender of the Temporary Certificates, the permanent 
" Certificates of Stock " are to be issued. 



1/ ■T" 



[•RICE ( >!•' ST< CK. 

The presenl Comptroller, Mr. L O Murray, who is watch- 
ing the National Hanks closer than an) previou 
done, and who is doing all that is in his po n the 

banks throughout the entire country, is now adv< 
thing that the writer has been tryin iinplish for some y 

as explained in this article, which appej the *' Philadelphia 

- d," issue of September i 7, 1910: 

MM T< ) M \kl*. i: VXKS S VFEK 

\'i w l.i ..ivi. m i,,\ |'i. w m i. ro l\ 1 .1" 1 

Important changes in the national bj pro- 

posed i" the next Congress, one of them b< oni|ie1 1 • 

organized national banks t" provide a surplus and an absolutely 
unimpaired capital the da} the) begin business. L'nder the 
present system a national bank with a paid in 
will spend probabl) $ - 

other necessities, thus impairing its « In sonn 

lias |>een two years before the bank earned enough t«» wip< 
that amount and have its capital stock unimpaired Even then 
ti had ii« 1 surplus. 

Tin- idea is to compel the organizers of a bank to pr< 
a 20 per cent, surplus at the start. It 1- understood ilia* 
a plan will be urged upon banks now forming, and that others 
will be urged to discontinue dividends until their surplus 
cumulated. 

There is also some talk of trying to increase the efficiency 
of national bank examiners b) asking Congress to create places 
for supervisor)' examiners who can superintendent the work oi 
the men in the field. 

Other plans for the better regulation of national ban! 
intended to reduce the possibilities of failures, are being con- 
sidered and probabl) will find their way to Congress thr g 
the Monetary Commission or officials of thr Treasury Depart- 
ment. 



WIXATI' 53 

Minutes of the Meeting of Organization Board. 



54 



BANK ORGANIZATION. 

THE AUTHOR'S FORM OF TEMPORARY CERTIFICATES. 



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56 BANK ORGANIZATION. 

FORMING PERMANENT BOARD OF DIRECTORS. 

After the stock has all been sold, you will be ready to call a 
meeting i^i your Organization Board, and after having gone 
over, apportioned and accepted your stock list, a motion to dis- 
band will be next in order, and the author uses the following 
order in winding up the Organization Board: 

" Mr. Chair man, 

I move you Sir, that w^e appoint Messrs 

( naming all the members of the Board who are to serve as Direc- 
tors) to serve as " Directors of the National Bank 

of " for the ensuing year, and until their succes- 
sors have been elected and duly qualified, and that we turn over 
to these gentlemen all unfinished business and unfulfilled obli- 
gations assumed by this Board." 

This motion being properly carried, a second and last motion 
is in order. 

" Mr. Chairman, 

I move you Sir, that this Organization Board, having ful- 
filled the object for which it was formed, we now disband." 

Upon this motion being carried, the Chairman declares the 
Organization Board disbanded. 

You are now ready to fill in your " Organization Papers," 
and a full set is included in these papers with full instructions, 
and if you follow the " Letter of Instructions" which accom- 
panied the papers, you will have no difficulty in properly filling 
them out. 

Note. — Appointing the Directors in the above manner is, of course, 
subject to the consent of the majority of the stockholders, and the stock- 
holders still have the power to protest against the Board as appointed and 
elect their own board, but usually when appointed as above the Board 
stands by the passive acquiescence of the stockholders. 



57 
Minutes of the Meeting of Organization Beard. 



58 BANK ORGANIZATION. 



THE COMPTROLLER'S LETTER OF INSTRUCTIONS 
AS TO HOW TO FILL IN ORGANIZATION PAPERS. 



Treasury Department, Office of the Comptroller of the 

Currency. 

Oct. — , 19—. 

Mr. Jno. R. Baer, 

Xo. 2915 N. Park Ave., 
Philadelphia, Pa. 
Sir: 

The application signed by and others, dated 

Sept. 11 for authority to organize " The " 

to be located at , with capital stock of $ , 

meets with approval. 

The title selected will be reserved for a period of sixty days 
to enable the persons interested to effect the organization of 
the bank, the required blanks for which purpose are inclosed. 

By carefully observing the following instructions and the 
explanatory notes on the blanks, in executing the latter, delay 
in establishing the bank will be avoided : 

ARTICLES OF ASSOCIATION. 

Section i. — Insert the title of the bank as approved. 

Sec 2. — Insert name of the village, town, or city, and that of the State. 

SEC. 3. — Instead of specifying that the Board of Directors shall con- 
sist of a definite number of shareholders, this section may provide: "The 
Board of Directors shall consist of not less than (here insert minimum 
number of directors) nor more than (here insert maximum number of 
directors) shareholders." If Directors are appointed, the last four lines 
of this section with regard to holding a meeting of shareholders for the 
election of Directors should be crossed off and the names of the Direc- 
tors inserted, adding the following clause: "Are hereby appointed Direc- 
tor- of this association to hold their offices as such until the regular 
annual election takes place, pursuant to the 4th article of these articles 
of association. 

SEC. 4. — Insert amount of authorized capital stock. There should ap- 
pear on page 2 of the articles the signatures of at least five persons, a 
majority of whom signed the application for authority to organize the 
bank. 



B W'K ORGANIZ 

Minutes of the Meetirg of Organization Board. 



BANK ORGANIZATION. 

ORGANIZATION CERTIFICATE. 

SECTION i. — Insert the title of the bank as approved. 

SEC. 2. — In specifying name of place, indicate whether ''village," 
" town," or '* city,'* and also give names of county and State. 

SEC 3. — In addition to entering amount of capital, give the number 
of shares into which it is divided. 

SEC. 4. — Insert names of shareholders, residences (town or city and 
State), and number of shares held by each for wh'ich certificates are to 
be issued to said shareholders when the bank is chartered and the stock 
has been paid for, as required by section 5140 of the United States Re- 
vised Statutes, transfers to be made in the regular manner in the case 
of any stock which changes ownership. 

There should appear on page 3 of the organization certificate the 
signatures of the persons who signed on page 2 of the articles. Acknowl- 
edgement must be made before a judge of court or notary public. 

OATHS OF DIRECTORS. 

Be particular to insert title of bank, location, name of State in which 
the Director resides, place of residence after signature of Director, and 
have the paper executed before an officer having a seal, if possible. In 
case the officer administering the oath has no seal, a certificate of the 
proper State, county, or court official to the effect that such officer is 
authorized to take acknowledgments must be attached. When the Direc- 
tors qualify jointly, it is unnecessary for each to make an individual oath. 

Under section 5146 of the United States Revised Statutes as amended 
February 28, 1905, every Director must own in his own right at least 10 
shares of capital stock of the association, unless the capital shall not ex- 
ceed $25,000, in which case he must own in his own right at least 5 shares. 

SIGNATURES OF OFFICERS. 

The signatures of all officers should be given, together with the date 
of the meeting of the Board of Directors at which the appointments were 
made. 

Officers can not be appointed until the Directors qualify as required 
by law. 

While it is desirable that the seal of the bank be affixed, the paper 
need not be withheld for that purpose, if such action will materially delay 
organization. Forwarding with without seal will necessitate the resub- 
mission of the signatures, under seal, after charter is issued. 

CERTIFICATE of OFFICERS and directors relative to payment OF capital 
STOCK, AND COMPLIANCE WITH OTHER LEGAL REQUIREMENTS. 

hiNert the exact title of the bank and place of location, togerther with 
the 1 mount of the authorized capital stock and the first instalment paid 
in, not less than 50$ : give the name, place of residence (town or city and 



BANK ORGANIZATIO 

Minutes of the Meeting cf Organization Board. 



62 BANK ORGANIZATION. 

State), and number o\ shares of slock of each Director, which must cor- 
respond with the number listed in the organization certificate. (Directors 
must net sign their own names on page 1.) 

There should be given on page 2 the signatures of a majority of the 
Directors, and the president or cashier, all of whom are required to make 
proper acknowledgment. This certificate should not be executed until 
the Directors have taken the oath above referred to, as required by sec- 
tion 5147. United States Revised Statutes. (Directors must affix their 
own signatures on page 2.) 

The bank does not become a body corporate until the execu- 
tion of the articles of association and organization certificate; 
and, as the date of the last acknowledgment of the latter deter- 
mines the time when the corporate existence begins, all other 
documents — oaths of directors, signatures of officers, certificate 
of payment of capital stock, etc. — must necessarily bear that 
date or one subsequent thereto. 

In the event that the business of any other bank is to be ac- 
quired, a statement should be forwarded on the blank inclosed 
for that purpose, signed by at least a majority of the directors, 
to the effect that any assets which may be purchased, or other- 
wise acquired, will not include real estate except banking prem- 
ises, stocks, loans secured by real estate, nor any loan in excess 
of 10% of the capital stock of the National bank actually paid 
in and unimpaired and 10% of the unimpaired surplus fund, the 
total not to exceed 30% of the capital stock. 

Upon the return of the inclosures properly executed and the 
deposit of the required amount of United States bonds as se- 
curity for circulation, the certificate authorizing the bank to be- 
gin business will be promptly issued, provided all legal require- 
ments are found to have been satisfied. The Comptroller should 
be advised of the name and address of the officer or other person 
to z^'hom the certificate is to be mailed. The bank may begin 
business on receipt of telegraphic advice of the issuance of 
charter. 

As it is desirable to have the charter number of the bank 
upon its letter head, it is suggested that the ordering of per- 
manent stationery be deferred until receipt of the telegram or 
charter. 

Respectfully, 

Wm. B. Ridgely, 
Incs. Comptroller. 



Minutes of the Meeting cf Organization Board. 



64 BANK ORGANIZATION. 

PROPER OFFICIALS TO ADMINISTER "OATHS OF 
OFFICE AND TO RECEIVE ACKNOWLEDGMENTS." 

There is always so much uncertainty as to the proper official 
to administer the "Oath of Office," receive acknowledgments, 
and to execute the organization papers that the author deems 
it expedient to deal with the subject in detail. 

i. — Articles of Association — No acknowledgment necessary. 

2. — Organization Certificate — Notary Public, Judge of Court. 
(Section 5134 R- S.) 

3. — Oaths of Directors — While being sworn into office — 
Notarv Public, Justice of the Peace, Judge of Court. (Section 

5147 R.S.) 

4. — Oaths of Directors — Relative to payment of Capital Stock 
— Justice ofthe Peace, Notarv Public, Judge of Court. (5168 
R. S.) 

5. — After Organization — All acknowledgments must be made 
before a Notary Public. 

NOTARY PUBLIC. 

Can a Notary Public be an officer in a National bank and 
act as its Notary ? Yes ; but he can not receive his own acknowl- 
edgment nor that of the president and cashier relative to the 
condition, earnings and dividends of the bank, i. e., if he is a 
director, cashier, teller, or bookkeeper. — (5211-5212 R. S.) 

Can a Notarv Public protest paper if he owns shares in the 
bank? Yes.— U. S. C. C. of A. 

Can a Notary Public own shares in a bank and act as Notary, 
swearing in the directors, receive their acknowledgments and 
fill out organization papers ? Yes. 






ORGANIZATION PAPERS. 
( To t><- txn cuted in rder. ) 



i . Articles of Asscx iation. 

2. Organization Certifi< 

3. Oatha of Dire< tors. 

4. Certificate as to Payments on Capital S 

5. Ordei olation. 

6. Signatun 



66 BANK ORGANIZATION. 

ARTICLES OF ASSOCIATION 

(Executed in duplicate) 



| Always fill ont this paper first. ] 

For the purpose of organizing an Association to carry on the business of 
banking, under the laws of the United States, the undersigned subscri- 
bers for the stock of the Association hereinafter named do enter into 
the following Articles of Association : 

First. — The title of this Association shall be " The 



Second. — The place where its banking house or office shall 
be located, and its operations of discount and deposit carried on, 
and its general business conducted, shall be 



Third. — The Board of Directors shall consist of 
shareholders. 



(See foot-note concerning appointing Directors.) 



The first meeting of the shareholders for the election of Direc- 
tors shall be held at 

on the , or at such other 

place and time as the majority of the undersigned shareholders 
may direct. 

Fourth. — The regular annual meetings of the shareholders 
for the election of Directors shall be held at the banking house 
of this Association on the second Tuesday of January of each 
year; but if no election shall be held on that day, it may be held 
on any other day according to the provisions of section 5149 of 
the Revised Statutes of the United States, and all elections shall 
be held according to such regulations as may be prescribed by 
the Board of Directors, not inconsistent with the provisions of 
the National Banking Law, and of these articles. 

Fifth. — The capital stock of this Association shall be $ 

dollars, 

divided into shares of one hundred dollars each; but the capital 
may, with the approval of the Comptroller of the Currency, be 



BANK ORGANIZATft 67 

Minutes of the Meeting of Organization Board. 



68 BANK ORGANIZATION. 

increased at any time by shareholders owning two-thirds of the 
stock, according to the provisions of an act of Congress ap- 
proved May i, [886; and in ease of the increase of the capital 
of the Association, each shareholder shall have the privilege of 
subscribing for such number of shares of the proposed increase 
of the capital stock as he may be entitled to according to the num- 
ber of shares owned by him before the stock is increased. 

Sixth. — The Board of Directors, a majority of whom shall 
be a quorum to do business, shall elect one of its members Presi- 
dent of this Association, who shall hold his office (unless he shall 
be disqualified, or be sooner removed by a two-thirds vote of all 
the members of the Board) for the term for which he was elected 
a Director. Directors shall have power to elect a Vice-President, 
who shall also be a member of the Board of Directors, and who 
shall be authorized, in the absence or inability of the President 
from any cause, to perform all acts and duties pertaining to the 
office of President except such as the President only is author-- 
ized by law to perform, and to elect or appoint a Cashier, and 
such other officers and clerks as may be required to transact the 
business of the Association ; to fix the salaries to be paid to them, 
and continue them in office, or to dismiss them as, in the opinion 
of a majority of the Board, the interests of the Association may- 
demand. 

The Directors shall have power to define the duties of the of- 
ficers and clerks of the Association, to require bonds from them, 
and to fix the penalty thereof; to regulate the manner in which 
elections of Directors shall be held, and to appoint judges of the 
election ; to make all by-laws that it may be proper for them to 
make, not inconsistent with the law, for the general regulation of 
the business of the Association and the management of its affairs 
and generally to do and perform all acts that it may be legal for 
a Board of Directors to do and perform under the Revised Sta- 
tutes aforesaid. 

Seventh. — This Association shall continue for the period of 
twenty years from the date of the execution of its Organization 
Certificate unless sooner placed in voluntary liquidation by the 
act of its shareholders owning at least two-thirds of its stock, 
or otherwise dissolved by authority of law. 

Eighths — These Articles of Association may be changed or 
amended at any time by shareholders owning a majority of the 



K ORGANIZATK *9 

Minutes of the Meeting of Organization Board. 



7o 



BANK ORGANIZATION. 



Stock of the Association, in any manner not inconsistent with 
law ; and the Hoard of Directors, or any three shareholders, may 
call a meeting for this or any other purpose, not inconsistent with 
law, by publishing notice thereof for thirty days in a newspaper 
published in the town, city, or county where the Hank is located, 
or by mailing- to each shareholder notice in writing thirty days 
before the time affixed for the meeting. 



IN WITNBS.S WHEREOF, we have hereunto set our hands, 
this day of 19 ... . 

(To be signed by at least five natural persons, prefe. ably the applicants.) 



I 


H 


2 


1.5 


3 


16 


4 


17 


5 


18 


6 


19 


7 


20 


8 


21 


<i 


22 


10 


23 


11 


24 


12 


25 


13 


26 



Have all those who signed the Application for permission 
to organize sign here (full name— no initials). If you can not 
get the original five, get your five strongest men to sign, includ- 
ing as many of the original five as possible. 



K ORG INIZATH 71 

Minutes of the Meeting of Organization Board. 



72 BANK ORGANIZATION. 

Instead of providing, in section three of the Articles of As- 
sociation, for the election of the first Hoard of Directors, the 
names o\ the Directors may be oiven therein if the stockholders 
are agreed as to the persons who are to constitute the Board. 
In this event the third article should read as follows: 

The board of directors shall consist of shareholders, and the 

following persons (here insert their names) are hereby appointed direc- 
tors of this association, to hold their offices as such until the regular 
annual election takes place, pursuant to the fourth article of these arti- 
cles of association, and until their successors are chosen and have quali- 
fied. 

The third section, if desired, may be made to provide for 
what is termed a sliding scale instead of a fixed number of Direc- 
tors ; in other words, a minimum and maximum number of 
Directors, in which event the section should read as follows : 

The board of directors shall consist of not less than (insert mini- 
mum number) nor more than (insert maximum number) shareholders; 
and the following persons (here insert their names) are hereby appoint- 
ed directors of this association, to hold their offices as such until the 
regular annual election takes place, pursuant to the fourth article of 
these articles of association, and until their successors are chosen and 
have qualified. The number of directors elected at each annual meeting 
shall constitute the board for the year, all vacancies to be filled as in 
the other case in accordance with the provisions of section 5148. 



IRGANIZATK 

Minutes cf the Meeting of Organization Beard. 



74 



BANK ORGANIZATION. 
ORGANIZATION CERTIFICATE. 

(Executed in duplicate.) 



H\\ the undersigned^ whose names are specified in article fourth of this 
Certificate, having associated ourselves for the purpose of organizing an 
.Association for carrying on the business of banking, under the laws of the 
I 'uited States, do make and execute the following Organization Certificate : 

First. The title of the Association shall be " The 



Second. The said Association shall be located in the 

of , County of , and State of 

, where its operations of discount and deposit arc to be 

carried on. 

Third. The Capital Stock of this Association shall be $ _ 



dollars, 



and shall be divided into shares of one hundred dollars 

each. 

Fourth. The name and the residence of each Shareholder of this Asso- 
ciation, with the number of shares held, are as follows : 





NAME 


RESIDENCE 


No. of Shares 


I 








2 








3 








4 








5 








6 








7 








8 








9 








10 








ii 








12 








,3 1 







B WK ORGANIZ VI ': 
Minutes of the Meeting of Organization Beard. 



^ 



BANK ORGANIZATION*. 



/•>'/'///. This Certificate is made in order that we may avail ourselves of 
the advantages of the aforesaid laics of the I T nited States. 

In witness whereof, we have hereunto set our hands, this 

day o/\ , /p 

(To be signed and acknowleJged by those who have signed the Articles of Association.) 



BANK ORCANfZATION. 

Minutes of the Meeting of Organization Board. 



:s HANK ORGANIZATION. 

(Acknowledgement must be made before Judge of Court or Notary Public.) 
Stater/ 



Comity of 



■• 



Before the undersigned, a 



of_ 



personally appeared 



to me well known, who severally acknowledged that they executed the fore- 
going Certificate for the purposes thereiyi mentioned. 



OFFICIAL SEAL 

OF 

OFFICER. 



Witness my hand and seal of office this 
day of , 19 



K ORG 

Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 

OATH OF DIRECTORS 

(Sect. 5147, U. S. R. S.) 



I0r. thr uunrratgnro Sirrrtrtrfi of The 

, located at 

being citizens of the United States, and residents 

of the State {or Territory) of. ) 

do, each for himself \ and not one for the other, solemnly swear that 
we will severally, so far as the duty devolves on us, diligently a?id 
honestly administer the affairs of said Association; and that we will 
not knowingly violate, or willingly permit to be violated, any of the 
provisions of the Statutes of the United States under which said As- 
social io?i has been organized, a?id, each for himself, does solemnly 
swear that he is the owner in good faith, and in his own right, of 
the member of shares of stock required by said statutes, subscribed by 
him or standing in his nameon the books of the said Association ; 
and that the same is not hypothecated, or in any way pledged as se- 
curity for any loan or debt. ( 

(Be sure and sign j-our name in full : John J. Henry, not J. J. Henr\\) 



SIGNATURE. 


SIGNATURE. 


j 


5 


2 


6 


3 


7 


4 


8 



OFFICIAL SEAL 

OF 

OFFICER 



State of ) 

J Iss : 

County of. J 

Subscribed and sworn to this 

day of. , 19 , 

before the undersigned, a Notary Public in 

aadfor said county. 

Notary Public. 

Also Justice of the Peace or Judge of Court of Record can administer this oath. 

NOTE. — Each director when elected must take oath of office, under 
section 5147, U. S. R. S., the oath should be trasmitted to the Comptroller 
of the Currency immediately after the election. If the officer administering 
the oath has no seal, a certificate of the proper State, county, or court 
official to the effect that such officer is authorized to take acknowledge- 
ments must be attached. 



Minutes of the Meeting of Organization Board 



BANK ORGANIZATION. 

(To be Blled in after Directors have assumed oath of office and elected their officers.) 

(Dftirial Signatures of the President, Vice-President, Cashier, 

and Assistant Cashier of The 

located at 

, appointed 

at a meeting of the Board of Directors held on the 

day of. , I9 

[Original signatures necessary.] 



SEAL 

OF 
BANK 



President. 
. Vice President. 
. Vice-President. 
. Vice-President. 
.Cashier. 

Assistant Cashier. 
Assistant Cashier. 



IMPORTANT. 



The signatures of officers should be forwarded, although no change 
may have taken place, and this paper will be returned for correction unless 
these directions are followed: (i) The signatures of the Vice-President 
and Assistant Cashier must be given, if you have such officers, in addi- 
tion to those of the President and Cashier. (2) Write the word "none" 
where the office is vacant. (3.) Affix the seal of the bank in the place 
designated. (4) Insert the title of the bank, and be careful to give 
date of appointment of officers. (5) Properly brief and promptly for- 
ward this paper to the Comptroller of the Currency. 

If you do not have your seal when you organize, etc., see 
" Letter of Instruction " received from the Government with the 
organization papers. 



g 3 

Minutes cf the Meeting of Organization Board. 



BANK ORGANIZATION'. 



CERTIFICATE RELATIVE TO PAYMENT OF 50% OF 
CAPITAL STOCK. 

5168 R. S. 

This certificate must be filled out and affirmed before a 
Justice of the Peace, Notary Public or Judge of Court. 

The rulings of prior Comptrollers had been that this paper 
should be filled out and sent in just as soon as 50% of the cap- 
ital stock of the bank had been collected, irrespective of what 
stockholders had paid in the same, taking the clause to mean 
50% in the aggregate. The present Comptroller, however, rules 
it to mean 50% on each share, so you must collect that amount 
on each share before you can send in this paper. This ruling is 
a decided disadvantage to any bank being organized under this 
ruling, as there are always good, reliable men in each community 
who, because of other affiliations, can not or will not take a hold 
during the organization period, and in order to hold shares of 
stock for such very desirable parties, the Directors are compelled 
either to purchase enough shares outright, or as private individuals 
borrow enough money to carry those shares — and in a number 
of cases the writer has known where a Board of Directors not 
being willing to do this, were unable to secure shares to draw in 
some of the best men in their towns, thereby losing their patron- 
age. The writer was on a street car with one of the Directors 
of a bank that had lately been organized in a town close by, 
when the Director spied a prominent manufacturer of his town 
who had as yet refused to affiliate himself with the new bank. 
Mr. Director tackled him and Mr. Manufacturer replied: "Yes, 
if you had given me some shares in your bank I would have at 

least kept my contingent fund there ; as it is the bank in 

is good enough for me." The reply was ''Hold on, we reserved 
five shares for you that you can have any time that you are ready 
for them." Result: Mr. Manufacturer is now carrying not only 
his contingent fund but his entire account at that bank and is 
slated for a Directorship, a clear gain of thousands of dollars a 
year caught by a reserve of five shares. 



K 0RGANI2 85 

Minutes of the Meeting of Organization Beard. 



86 BANK ORGANIZATION. 

The Certificate also contains the clause " that all legal re- 
quirements had been complied with," such as selling stock, filling 
out organization papers, purchasing bonds, etc. 

Fill in blank, inserting title of bank and location, give name 
and residence and number of shares of stock held by each Direc- 
tor. Be sure that the number of shares mentioned in this certi- 
ficate corresponds with the number assigned to each Director as 
listed in the Organization Certificate. 



Form Used in Certifying to the Payment of 50 r /c of Capital 
Stock in State Banks. — Pennsylvania Form. 



To the Commissioner of Banking 

of the 
Commonwealth of Pennsylvania. 

Pursuant to Section Nine of the Act of May 13th, 1876, as amended 

by the Act of February nth, 1895, we do hereby certify that 

per cent, of the Capital Stock of the 

of , Pa., incorporated under the Act above 

referred to, amounting to $ , has been paid in, in cash. 

_ .President. 

Cashier. 



Commonwealth of Pennsylvania, 
County of 



ss 



Before me, a Notary Public in and for said county and State, came, 

on 191 , President, 

and Cashier, of the above named bank, 

who, being duly sworn, depose and say that the statement made in the fore- 
going Certificate ts true and correct. 



Notary Public. 
My commission expires . 



aizvii 

Minutes of the Meeting of Organization Board. 



88 



BANK ORGANIZATION. 



Certificate cf Officers and Directors Relative to Payment of 

Capital Stock and Compliance with Other 

Legal Requirements. 



19.. 



The undersigned, Officers and Directors of 

located at 

organized under the provisions of the Revised Statutes of the 
United States authorizing the organization of national banking 
associations, do hereby certify that of the authorized capital stock 

of $ there has been paid into said bank, in cash, as 

permanent capital, $ , and that no part of this sum is 

represented by promissory notes or other evidences of debt ; also 
that the name and place of residence of each Director, and the 
amount of stock individually owned in good faith, are as follows : 



* NAME OF DIRECTOR. 


PLACE OF RESIDENCE. 
(Town or City and State.) 


Number of Shares 
of Stock. 

(See organization certificate) 


1 






2 






3 






1 
4 




1 




i 









The names, etc., of all the directors of the association should appear 
on this page. A majority of the directors, exclusive of the president or 
cashier, must sign on the following page and make acknowledgement. 



The names of all the Directors must be listed here. Be sure 
that the number of shares of stock listed here correspond with 
the number listed in Organization Certificate. Directors need 



not sign their own names here. 



.K ORG \M/ 
Minutes cf the Meeting of Organization Board. 



90 BANK ORGANIZATION. 

It is further certified that the association has in good faith 
complied with all oi the provisions that are required to be com- 
plied with before receiving authority to commence the business 
oi banking. 



Directors. 



The majority of your Directors must sign their ozvn names 
here; /'. e., if you have thirteen .Directors, seven must sign here 
and the President signs below. As the officer certifying to the 
paper can not certify also as a Director to make a majority, there- 
fore von can not count his name in with the above seven. 



, President. 
, Cashier. 



State of \ 

[ ss : 
County of ) 

Before the undersigned, a of 

personally appeared the above-named directors and other officers 
of the aforesaid National bank, and made oath that the foregoing 
certificate and the matters and things therein set forth are true 
to the best of their knowledge and belief. 

Witness my hand and seal of office this 

day of , 19 ... . 



OFFICIAL SEAL 

OF 

OFFICER 



To be acknowledged before a Notary Public, Justice of the 
Peace or Judge of Court. 



K ORG \\'!Z \TK)\ 
Minutes of the Meeting of Organization Beard. 



92 



BANK ORGANIZATION. 



PRELIMINARY EXAMINATION 



After you mailed in your paper certifying that you had col- 
lected 50^ of the capital stock of your bank and had complied 
with all other requirements, the Comptroller will send you a 
personal representative to make a preliminary examination and 
you should have a complete statement ready for him, show him 
the original subscription papers, minutes, bills and receipts and 
your bank book that he can reconcile and balance your accounts, 
and if you will have all these things ready for him, you will 
expedite the opening of your bank, for as soon as the examiner 
sends in his report and it is favorable, you will receive your per- 
mission to open for business. 

Be sure and have a clear " Stock Record." So many fail 
in this respect. Rule off a list as per cut and you will have no 
trouble if you make records only of actual cash received. 





Price of Stock 


Stock List o 


f 


National Bank of 






$125.00 
















I Cfl 

3 

Address. £ 

! z 


1 d 

m 

<J CO 


Dates of different calls. 


Total should 
amt. to Sell- 
ing Price of 
Stock instead 
of Par Value. 


No. 


Name. 


U 

CO 





"3 

•0 

CO 


"3 
O 

"3- 


"3 


to 


"3 


"3 
u 





























































































































































1 















Por easy reference, numbers should be same as those used in Organization Certificate. 



9 2a 



Daily Banker and Stockholder, X. )'.. Oct. /, 

THE EXAMINATION OF A BANK PRIOR TO GRANT- 
ING A CHARTER. 



I >. I'., dinger, National i . dis- 

cussing this, sa 

Preliminary to tl 

nail) is the practice of the Comptroller t«» request tnf 
tion i ating in the i the fina 

standing arid th experiem e and general n 
I !<• will also desire to • be ad> 
if the field offers opportunity Foi tin establishmi 
1 anking institution. 

It" the reports are favorable the examinei 
to make a preliminary examination before the bank i* auth 
to begin the transaction of business. The instrw quire 

( i i. that .it such examination it must i 

That the i ition proceedings have 1« that 

a list oi shareh Iders should be carefully i an) 

changes made since the organization certifi 
giving the amount of -hair- subscribed for b) each. (3), that 
the examiner shall ascertain if the stock was sold in 
par. and, if so, what disposition was made of the premium. 
Uso if each subscriber has paid 5 
i" the capital st< ck, and where the funds are deposited. 

It is a verj easy matter to admit new hanks into th- 
tern, but it is quite difficult to weed out an undesira 
Banks that have a capable and honest heard of dii 
the department cause for apprehension and seldom, if ever. 
less to either depositors « r shareholders. Hence, in making the 
preliminary examinations, as well as the regular ones, examiners 
should be mindful that there are unwritten considerations that 
should not be ignored, to the end that the Comptroller should 
he plaeed in possession oi a complete knowledge of all condi- 
tions bearing upon the subject 



92b BANK ORGANIZATION*. 

It was slated recently in a prominent financial journal that 
substantially one-third of the applications for authority to or- 
ganize new hanks were rejected by the Comptroller. This is 
surely a ease where an ounce of prevention was worth more than 
a pound of cure. 

It has frequently happened that two or more National banks 
have been established in a community where the public con- 
venience could as well have been satisfactorily served by a less 
number. This condition is productive of harmful competition 
and bad banking methods and the Comptroller has the best in- 
terest of the service in mind in giving consideration to this phase 
of the subject in authorizing the establishment of new banks. 

We all naturally feel a warranted pride in the National bank- 
ing system and we welcome the establishment of new banks 
in our respective territories. This sentiment is laudable and 
proper provided there is a reason to believe the new banks will 
develop into prosperous institutions. 

It is doubtful if an examiner is called upon to perform a 
more important service than here outlined. If character consti- 
tutes an important element in the establishment of personal credit 
it is certainly no less important in determining the credibility 
of those who propose to organize banking institutions. If un- 
worthy and speculative elements can be primarily barred from 
National banks, much will have been accomplished to justly 
entitle the banks to public confidence, and it will also greatly 
simplify the labors of future supervision. 

( )n the question of new charters and modus operandi of pro- 
curing comprehensive data for use of the Comptroller in determin- 
ing their advisibility, E. Southall, National Bank Examiner for 
Southern Pennsylvania, says : 

This subject has been assigned to me, no doubt, on account 
of my twenty years' experience in the office of the Comptroller 
of the Currency, where I last served as chief of the Organiza- 
tion Division, and I will endeavor to briefly set forth the course 
which should be pursued to make a satisfactory examination for 
the purpose of ascertaining whether all legal requirements have 
been satisfied in connection with the organization of a National 
bank or the conversion of a State bank, thus warranting the 
issuance of certificate authorizing the commencement of business 
a- a National banking association. 



h is advisable to pr< 

for th< 

ter with ' a bona 

I or 
em- 

k lias 

ash and 

amount 

thcr 

than 

in name of bank, I rticular t< 

[nfoi 
•i- building is om ned or ren! 

and whi 

C 

the 1 tmi n 

When a National bank is 
banking institution, the examii Id, in addition to purs 

the course above outlined, the char- 

acter and value of tli be purchased and tr 

not befor< n this it will be seen that the acquin 

such as may be taken under the law must be a dis 

n and have no c n with the paym apital 

. it being necessary that at l< 
paid in cash before charter is I examin 

of the State bank or other banking institution should be made 

jection thereto, other 
acquired. 

Under Section 5154, United States Revised Statutes, any 
incorporated by special law or any banking institution or- 



92d BANK ORGANIZATION, 

ganized under a general law of any State may become a National 
association. While, in such a case, conversion papers must be 
executed, no moneys need be paid in by shareholders if the 
hank has a paid in and unimpaired capital stock of requisite 
amount. All that is necessary, therefore, is to make a thorough 
examination to determine whether the bank has sufficient solvent 
and readily convertible assets to offset its liabilities, such assets 
as can be held by a National bank. The purchasing of assets is 
not involved as, upon conversion, all of the property of the State 
bank becomes that of the National bank, and the latter is liable 
for all debts of the former. 

In submitting report of examination of a bank of primary 
origin, succession, or conversion, the examiner should give the 
department the benefit of his judgment whether all proceedings 
have been regular and conditions are such as to justfy the issu- 
ance of certificate authorizing the commencement of business. 



BANK riZATIO 93 

Minutes of the Meeting cf Organisation Board. 



94 BANK ORGANIZATION. 

COMPTROLLER'S AUTHORITY TO COMMENCE THE 
BUSINESS OF BANKING. 

When the examiner who made the preliminary examination 
oi your bank sends in a favorable report, yon will receive — by 
telegram — permission to begin the business of banking, and 
your charter will be mailed to you — you need not await its ar- 
rival, as your telegram is your authority to open your doors for 
business. 

COPY OF CHARTER. 



Treasury Department, 
Office of Comptroller of the Currency, 



Washington, , 19 



Whereas, by satisfactory evidence presented to the undersigned, it has 
been niade to appear that — 

The , located in the of , in the county of 

and State of , has complied with all the provisions of the statutes of the 

United States required to be complied with before an association shall be au 
thorized to commence the business of banking ; 

Now, therefore, I, , Comptroller of the Currency, do hereby 

certify that— 

The , located in the of , in the county of 

and State of , is authorized to commence the business of banking as 

provided in section fifty-one hundred and sixty-nine of the Revised Statutes of 
the United States. 

In testimony whereof witness my hand and seal of office this day 

of , 19 • 



[seal] Comptroller of the Currency. 



Minutes of the Meeting of Organization Beard. 



BANK ORGANIZATION. 



OATH OF PUBLICATION. 

The certificate of the Comptroller authorizing your bank to 
open for business must be published for sixty days in a newspa- 
per printed in the city or county where the bank is located ; this 
may be in a weekly newspaper or a weekly edition of a daily. 

It there is no paper published in your town or county, you 
must publish the following charter in a newspaper published 
in a locality nearest to your place of business. 

State of. 

County of 

Cut the printed notice from the 
newspaper and attach here. 

being duly sworn, deposes and says that he 
is the publisher of 



Forward notice to Comptroller of 
Currency as promptly as possible. 



newspaper published in 



the. 
of 



, County of 

, State of 

, and that 

the annexed advertisement of the Comp- 
troller's Certificate authorizing the 

to begin the business of 

banking has appeared in each issue of said 
paper for a period of at least sixty days, be- 
ginning the 

day of and 

ending the 

day of 19 



Subscribed and sworn to before me, a 

for the State and County aforesaid, this 

day of_ _.., 19 



and 



Minutes of the Meeting of Organization Board 



9 8 



r.AXK ORGANIZATION. 



Author's Form Used Where Applications for State Bank 
Charters Have to Be Advertised. 



OATH OF PUBLICATION. 



State of 

County of 

Cut the rri:ited notice from the 
newspaper and attach here. 

NOTICE ! 

NOTICE is hereby given that an 
application will .be niade to 
the Governor of the State of Penn- 
sylvania, on the 22nd day of April, 
1910, bv Jno. R. Baer, James I^au 
and Ivloyd L,. Bentz, citizens of 
the Commonwealth of Pennsyl- 
vania, under the provisions of an 
Act of General Assembly of the 
Commonwealth of Pennsylvania, 
approved the 13th day of May, A. 
D. 1876, entitled "An act for the 
incorporation and regulation of 
Banks of discount and deposit.'' 
and the supplements thereto, for 
the Charter of an intended corpo- 
ration to be called "Farmers and 
Merchants Bank," and to be lo- 
cated in the borough of Dillsburg, 
and county of York. State of Penn- 
sylvania, for the purpose of car- 
rying on the business of Banking 
under the provisions of the Act 
aforesaid and the supplements 
theieto. The amount of the Cap- 
ital Stock is 525.000.00 divided in- 
to 500 shares of Fifty Dollars each. 
John R. Baer, 
James L,au, 
I,loyd L. Bentz. 



Forward notice to Commissioner of 
Banking as promptly as possible. 



SS : 



being duly sworn, deposes and says that he 
is the publisher of 



a newspaper published in 

the 

of , County of 

, State of 

, and that 
the annexed advertisement of application 

tor Charter of the 

has appeared in issue of 

said paper for thirteen consecutive weeks, 

beginning the „ 

day of and 

ending the 

day of 19 



Subscribed and sworn to before me, a _ _ in and 

for the State and County aforesaid, this 

day of , 19 



99 

Minutes of the Meeting of Organization Board. 



ioo BANK ORGANIZATION. 



Form Used by Author When Application for State Bank 
Charters Have to Be Advertised Previous to Char- 
ter Being Granted, as in Pennsylvania. 



NOTICE. 

Notice is hereby given that an application will be made to 

the Governor of the State of Pennsylvania, on the 

day of 1910, by 

citizens of the Commonwealth of Pennsylvania, under the provi- 
sion of an Act of General Assembly of the Commonwealth of 
Pennsylvania, approved the 13th day of May, A. D. 1876, entitled 
" An Act for the incorporation and regulation of Banks of dis- 
count and deposit," and to be called " ,' r 

and to be located in the of , 

county of , State of Pennsylvania, for the pur- 
pose of carrying on the business of Banking under the provi- 
sions of the Act aforesaid and the supplements thereto. The 

amount of the Capital Stock is $ , divided into 

shares of fifty dollars each. 



To be signed by three of the petitioners, embodying in the 
application the names of six or eight of your strongest men, 
thereby giving your application a standing in your community. 



IOI 



Form Used by Author When Application for State Bank 
Charters Have to Be Advertised Previous to Char- 
ter Being Granted, as in Pennsylvania. 



NOTICE 

000 Hank ) 



Notice is hereby given that an application will be made to 
the Governor of the State of Pennsyh the 

day of [910, by 

citizens of the Commonwealth of I ania, under the | 

son of an A 'it-nil Assembly of the Commonwealth of 

Pennsylvania, approved the 13th dayoi titled 

"An Act for the incorporation and r< ks of dis- 
count and deposit/ 1 and .'. . 19, and to 

ted in the 

of . . county 

of State- of Pennsylvania, said 

of bavin- less than 5000 inhabitant 

the purpose of carrying on the busim under the 

provisions of th< aid and the supplements thereto. 

The amount of the Capital Stock is 5 divided 

into shares of fifty dollars each. 



This form to be used 
for banks having $25,000 

Capital Stock. 



To bs signed by three of the petitioners, embodying in the 
application the names oi six or eight oi your strongest men, 
thereby giving your application a standing in your community. 

Notk. — These tonus. being nsed in the State of Pennsylvania, arc only 
given lure as a guide for organizers in other States and not as the' forms to 
be used outside of Pennsylvania. Form on page 100 is nsed for hanks hav- 
ing capita] stock of (50,000, on page 101 for (25,000 hanks only. 



io2 BANK ORGANIZATION. 



RESERVE AGENTS. 

After having gone so far with your organization, it is time 
you should make arrangements to have your Reserve Agents 
appointed. It is best to ask for two appointments, the one a 
New York bank, the other a bank in your nearest reserve city. 

The reserve cities are : Albany, Baltimore, Brooklyn, 
Boston, Cedar Rapids, Cincinnati, Cleveland, Columbus, Dallas, 
Denver, Des Moines, Detroit, Dubuque, Fort Worth, Houston, 
Indianapolis, Kansas City, Mo. ; Lincoln, Los Angeles, Louisville, 
Milwaukee, Minneapolis, New Orleans, Omaha, Philadelphia, 
Pittsburg, Portland, St. Joseph, St. Paul, Salt Lake City, San 
Francisco, Savannah, Washington, Wichita. So choose the one 
in the town nearest to your bank, notify the bank of your desire 
and they will attend to all the necessary details for you. 

The law requires all banks to have on hand in lawful 
money of the Lmited States at least 25 per cent, of their de- 
posits, if situated in " Reserve Cities ;" in all others at least 15 
per cent, of their deposits. Three-fifths of this 15 per cent. Re- 
serve ma3' be kept in Reserve City banks, approved by the 
Comptroller. 

In selecting such reserve agencies it is very important that 
a wise selection be made. The whole future success of the bank 
may depend on having relations with banks that will treat the 
new organization with liberality and consideration. 



&■ 



U. S. BONDS TO SECURE CIRCULATION. 

National Banks with a capital of $50,000 or less are required 
to deposit bonds equal to one-fourth of their capital, and at least 
$50,000 must be deposited by banks with capital over $150,000. 
Banks may or may not issue circulating notes; these notes may 
be issued equal to the par value of the bonds, not exceeding the 
amount of paid-in capital stock. 

The best way for you to do is to mail New York draft for 

a little more than the amount of bonds you wish to purchase to 

your nearest reserve agent and let them purchase the bonds for 

you and transmit same to Washington, as they are better 



Minutes of the Meetirg of Organization Board. 



io4 BANK ORGANIZATION. 

qualified to judge which bonds to purchase. You will always 
find your reserve agents willing to oblige you in this. 

You order your circulation in proportion to amount of bonds 
you wish to purchase, i. c, if you invest only the minimum 
amount of 25 per cent, of your capital stock, you order one and 
one-half times that amount of currency. — See note on order sheet 
for more explicit instructions and also the answer received to 
one order that was wrongly placed. 



Minutes of the Meeting of Organization Board. 



io6 



BANK ORGANIZATION. 



Letter 

Scries of IQ02. 

ORIGINAL ORDER FOR PLATES AND CIRCULATION. 



Charter No. 
NATIONAL 



BANK OF 

, i9 



To the Comptroller of the Currency. 
Sir: 

You arc requested to have plates engraved for this bank, 
the cost to be paid upon demand, and circulating notes printed 
therefrom as follows : 



Cost of 
'Plates 



#75- 
75 
75- 
50. 



No. of Sheets 
Ordered. 



Denominations on 
Sheets. 



$5, $5, $5, $5 

$jo, $10, $fo, $20... 
$10, $10, $10, $10... 
$50, $100 



Total. 



Value Per 
Sheet. 



$20.. 
50.. 
40 . 
I50. 



Amount of 
Order 



Respectfully, 



Cashier. 

Note. — Original orders for circulation should be as nearly one and 
11 e- luil f in amount of the par value of bonds to be deposited as can be 
made from multiples of the face value of sheets of notes ordered. Cir- 
culation ordered in excess of the bonds deposited will be required to 
replace mutilated notes returned for redemption and destruction. 

The Act of March 14, 1900, provides that no national bank shall be en- 
titled to receive from the Comptroller, or to issue more than one-third 
in amount of its circulating notes of the denomination of $5. Banks de- 
siring the full amount of circulation to which they are entitled, including 
notes of the denomination of $5, must order, at least, two plates. 

It will require about forty days to engrave the plate and to print 
circulating notes, but the order can not be acted upon until all legal 
requirements are satisfied, including the deposit of bonds with the 
Treasurer of the United States, as the charter number of the association, 
which can not be previously determined, must appear upon the plate from 
which the notes are printed. 



Minutes of the Meeting of Organization Board. 



io8 BANK ORGANIZATION. 

Letter Book W . 

NOTICE OF ORDER TO ENGRAVE PLATE. 

Treasury Department, Office of the Comptroller op the 

Currency. 

Washing-ton, D. C, , 19 ... . 

Cashier 
Sir: 

The Director of the Bureau of Engraving and Printing has 
this day been requested, as per your original order, to prepare 

plate $10, $10, $10, $20, for your bank, and 

to print therefrom $22,500. Order has been increased to meet 
the requirements of the Act of May 30, 1908. 

When ready, which will be in about forty-five days, the 
amount due will be forwarded, and the balance held in the vault 
of this office to reimburse your bank for any of its mutilated 
notes that may be redeemed and destroyed. 

Please remit draft on New York for $75 (Note), to the order 
of the Comptroller of the Currency, to pay for the plate. 

Respectfully, 

W. J. Fowler, 
Deputy Comptroller. 

Should you desire some $5.00 notes, you would have to pur- 
chase an additional plate at the expense of $75.00. 

VOTING POWERS OF STOCKHOLDERS. 

In all elections of directors, and in deciding all questions 
at meetings of shareholders, each shareholder shall be entitled 
to one vote on each share of stock held by him. Under section 
5144, shareholders may vote by proxies duly authorized in writ- 
ing, but no officer, clerk, teller, or bookkeeper of the association 
can act as proxy, and no shareholder whose liability is past due 
and unpaid shall be allowed to vote. The Comptroller, sup- 
ported by certain decisions of the courts, holds that a director is 
an officer within the meaning of said section, and, furthermore, 
that the prohibition with regard to the voting of stock by a share- 
holder who is liable to the bank merely applies to subscriptions 
to capital stock. 



Minutes of the Meeting of Organization Board. 



BANK ORGANIZATION. 



CUMULATIVE VOTING. 

Cumulative voting at meetings of national banking asso- 
ciations is not permissible. For instance, if a shareholder is the 
owner of ten shares of stock and seven directors are to be elected, 
he can not cast seventy votes in favor of any one person as a 
director, but can only cast ten votes for each of the seven candi- 
dates, or for as many of the seven as he sees fit. 

FORM OF PROXY. 

Know ail men by these presents that I, , do hereby- 
con stitute and appoint — - attorney and agent for me, and in 

my name, place, and stead to vote as my proxy at any and all elections 

of directors of according to the number of votes I should 

be entitled to vote if there personally present. 

In witness whereof I have hereunto set my hand this day of , 

one thousand nine hundred and . 



Signed in presence of- 



Ill 

Minutes of the Meeting of Organization Board. 



ii2 BANK ORGANIZATION. 



WHAT YOUR WASHINGTON AGENTS WILL DO FOR 

YOU. 

The relation of a National Bank to the government requires 
that it be represented by attorney before the Treasury Depart- 
ment, under Section 5184 of the Bank Act and Treasury Regula- 
tions, to attend to the counting, examining and witnessing the 
destruction of its circulating notes redeemed, which are unfit for 
further use, and under Section 5166 to examine annually the 
bonds of the bank on deposit with the U. S. Treasurer. 

In addition to these regular duties there are many other 
matters which from time to time call for personal and experi- 
enced services at the Department, and for this reason the writer's 
company has entered into an arrangement with the firm of A. S. 
Pratt and Sons, of Washington, D. C, to represent before the 
Department the banks they organize, as this firm has acted as 
attorney for National Banks from the inauguration of the Na- 
tional Banking System. 

Besides performing the above named duties for our banks, 
they also render a great many other valuable services, viz : 

1. They furnish bonds to secure charter and circulation. 

2. They make lawful money deposits to withdraw bonds 
for banks reducing circulation. 

3. They wire the date the Comptroller calls for statement 
of condition of banks as soon as announced, thus avoiding the 
delay of mail and saving valuable time. 

4. They send the new currency of banks by registered mail, 
insured, when cheaper than by express, serving over one thousand 
banks in this way. 

5. They attend to a great variety of matters for the banks 
at the Department, and answer innumerable letters and questions 
concerning the rights and restrictions under the Bank Act. 

In brief, they make the interests of the banks their own, 
looking carefully after their business, and as their office is situ- 
ated directly opposite the Department, they can do this all the 
more readily, and they are constantly at the Department attend- 
ing to a great variety of matters for their correspondents. 



Minutes of the Meeting of Organization Board 



U4 BANK ORGANIZATION 

BY-LAWS. 



A copy of the by-laws must be filed in the Comptroller's of- 
fice as soon as adopted. 

By-laws must conform to the requirements of the national 
banking laws and your articles of association and can not be 
changed in an}' way conflicting with either. 

GENERAL FORM FOR BY-LAWS. 

By-laws of the organized under the 

laws of the United States, and authorized by the Comptroller of the Cur- 
rency to carry on the business of banking. 

ELECTIONS. 

i. The regular annual meetings of stockholders of this bank for 
the election of directors and for the transaction of other legitimatj busi- 
ness, shall be held between the hours of ten o'clock a. m. and three 
o'clock p. m. on the day specified in the articles of association, and the 
thirty days' notice of the time and obje°_ of sum meetings thereby re- 
quired shall be given by the president, vice-president, or cashier, by pub- 
lication in . The board of directors shall, within 

one month previous to the date fixed for such meetings, appoint three 
stockholders to be judges of the election for di' ectors, who shall hold 
and conduct the election, and who shall, under their hands, notify the 
person acting as cashier of this bank of the result thereof as soon as 
ascertained, and of the names of the directors-elect. 

2. The person acting as cashier shall thereupon cause the returns 
made by the judges of election to be recorded upon the minute-book of 
the bank, and shall notify the directors chosen of the ; r election, and 
of the time for them to meet at the banking house for the organization 
of the new board. If at the time fixed for such meetings there should 
be no quorum in attendance, the directors-elect present may adjourn from 
time to time until a quorum shall be obtained. 

3. The directors-elect shall meet for organization, upon the notifi- 
cation given in accordance with law 2, within one week, from the time 
of their election, but shall not do any business whatever prior to quali- 
fying by taking the oath of office as required by law. 

4. If the annual election for directors should not be held on the 
day fixed by the articles of association, the directors in office shall order 

ial election, of which notice shall be given, judges appointed, and 
returns made and recorded upon the minute-book; and the directors 
chosen thereat shall be certified to the cashier, and notified as provided 
by laws 1 and 2. 

OFFICERS. 

5. The officers of this bank shall be a president, vice-president, 
(who shall be members of the board of directors), cashier, and such 



»»5 
Minutes of the Meeting of Organization Board. 



n6 BANK ORGANIZATION. 

other officers as may be required from time to time for the prompt and 
orderly transaction of its business; and all officers, clerks, and agents 
shall be elected, appointed, or employed by the board of directors, or 
with the consent thereof, and their several duties may be prescribed by 
the board. 

6. The president shall hold his office for the current year for which 
the board of which he shall be a member was elected, unless he shall 
resign, become disqualified, or be removed; and any vacancy occurring 
be tilled by the remaining members. 

7. The cashier and the subordinate officers and clerks shall be ap- 
pointed to hold their offices respectively during the pleasure of the board 
of directors. 

8. The cashier of this bank shall be responsible for all the moneys. 
funds, and valuables of the bank, and shall give bond, with security to 
be approved by the board, in the penal sum of dollars, condi- 
tioned for the faithful and honest discharge of his duties as such cashier, 
and that he will faithfully apply and account for all such moneys, funds, 
and valuables, and deliver them to the order of the board of directors 
of this bank, or to the person or persons authorized to receive them. 

9. The president of the bank shall be responsible for all such sums 
of money and property of every kind as may be intrusted to his care or 
placed in his hands by the board of directors or by the cashier, or other- 
wise come into his hands as president, and shall give bond, with securi- 
ty to be approved by the board, in the penal sum of dollars, 

conditioned for the faithful discharge of his duties as such president, 
and that he will faithfully and honestly apply and account for all sums 
of money and other property of this bank that may come into his hands 
as such president, and pay over and deliver them to the order of the 
board of directors, or to any other person or persons authorized by the 
board to receive them. 

10. The teller shall be responsible for all such sums of money, 
property, and funds of every description as may from time to time be 
placed in his hands by the cashier, or otherwise come into his posses- 
sion as teller, and shall give bond, with security to be approved by the 

board of directors, in the penal sum of dollars, conditioned 

for the honest and faithful discharge of his duties, and that he will 
faithfully apply, account for, and pay over all moneys, property, and 
funds of every description pertaining to this bank that may come into 
his hands by virtue of his office as teller, to the order of the board of 
directors, or to such person or persons as may be authorized by the 
board to receive them. 

11. The bonds of the officers shall be placed in the custody of a 
stockholder of this bank, to be designated by the board of directors, who 
shall not be one of the bonded officers, to be surrendered by him only 
upon the order of the board. 

SEAL. 

12. The impression made below is an impression of the seal adopted 
by the board of directors of this bank. 



rioN. 

Minutes of the Meeting of Organization Board. 



itS BANK ORGANIZATION. 

CONVEYYANCE OF REAL ESTATE. 

13. All transfers and conveyances of real estate shall be made by 
the bank, under the seal thereof, in accordance with the orders of the 
board of directors, and shall be signed by the president or cashier. 

INCREASE OF CAPITAL STOCK. 

14. Whenever an increase of stock shall be determined upon in 
accordance with the articles of association of this bank, it shall be the 
duty of the board of directors to cause all the stockholders to be noti- 
fied thereof, and a subscription to be opened therefor, specifying the 
terms of payment agreed upon by subscribers. Eeach stockholder shall be 
entitled to subscribe for shares of the new stock in proportion to the num- 
ber of shares he already owns ; but if any stockholder shall fail to sub- 
scribe for such new stock as he may be entitled to, or to pay his sub- 
scription according to agreement, the board of directors shall determine 
what disposition shall be made of the privileges of subscribing for the 
new* stock not taken. 

BUSINESS OF THE BANK. 

15. The bank shall be open for business from o'clock a. m. 

to o'clock p. m. each day, except Sundays and days recognized by 

the laws of this State as holidays. 

16. The board of directors of this bank shall hold regular meet- 
ings at the banking-house for the transaction of business on 

of each week, and should that day in any year fall upon a holiday, the 
regular meeting for that week shall be held on such other day as the 
directors at the preceding meeting may order. 

The board may also hold special meetings upon the call of the presi- 
dent, cashier, or any three or more members, and whenever there shall 
not be a quorum at a regular or special meeting, the members present 
may adjourn the meeting from day to day until a quorum shall be ob- 
tained; and any meeting may be adjourned from time to time by a vote 
of a majority of a quorum present, but no business except adjournment 
shall be transacted in the absence of a quorum. 

17. There shall be a committee, to be known as the exchange com- 
mittee, consisting of the president, directors, and cashier, who 

shall have power to discount and purchase bills, notes, and other evi- 
dences of debt, and to buy and sell bills of exchange ; and who shall, 
at each regular meeting of the board of directors, make a report of all 
bills, notes, and other evidences of debt discounted and purchased by 
them for the bank since their last previous report, this report shall be ap- 
proved by the Board and duly recorded. 

18. The board of directors may appoint one of its members or an 
officer of the bank to act as its secretary. 

19. No officer or clerk of this bank shall pay any check drawn upon 
it, or pay out money on any order, unless the drawer of such check or 
order shall, at the time of the presentation thereof, have on deposit in 
the bank funds sufficient to meet such check or order. 

20. The earnings of this bank shall be disposed of according to 



Minutes of the Meeting of Organization Board. 



120 BANK ORGANIZATION. 

orders of the board of directors, mack- at regular or special meetings, 
and no dividend shall be paid to stockholders, or other disposition of 
earnings made, except upon order of the board. 

21. The organization papers of this hank, as executed and filed 
with the Comptroller of the Currency, the returns of judges of the 
elections, the proceedings at all regular and special meetings of the board 
of directors, the by-laws, and all changes and all amendments thereof, 
and the report of examining commilteess of directors, made according 
to law 28, shall be recorded in the minnte-book ; and the minutes of 
each meeting of the board shall be signed by the president and attested 
by the cashier. 

22. The board of directors shall have power to prescribe and when 
expedient, to change the form of books and accounts to be used in the 
transaction of the business of this bank, and to prescribe the general 
or particular manner in which its affairs shall be conducted. Minute- 
Book (copy back on cover). 

TRANSFER OF STOCK. 

23. The stock of this bank shall be assignable and transferable only 
on the books of this bank, subject to the restriction and provisions of 
the banking laws, and a transfer book shall be provided, in which all 
assignments and transfers of stock shall be made. 

24. Transfers of stock shall not be suspended preparatory to the 
declaration of dividends ; and unless an agreement to the contrary shall 
be expressed in the assignments, dividends shall be paid to the stock- 
holders in whose name the stock shall stand at the date of the declara- 
tion of dividends. 

25. Certificates of stock signed by the president and cashier shall 
be issued to stockholders, and the certificates shall state upon their 
face that the stock is transferable, and the certificates shall state upon 
their face that the stock is transferable only on the books of the bank. 

EXPENSE. 

26. All the current expenses of this bank shall be paid by the 
cashier, who shall, every six months, or oftener if required, make to the 
board of directors a detailed statement thereof. 

CONTRACTS. 

27. All contracts, checks, drafts, etc., for this bank, and all receipts 
for circulating notes received from the Comptroller of the Currency, 
shall be signed by the president or cashier. 

EXAMINATIONS. 

28. There shall be appointed by the board of directors a commit- 
tee of members thereof, whose duty it shall be to examine every 

three months the affairs of this bank, to count its cash, and compare its 

and liabilities with the accounts of the general ledger, ascertain 
whether these accounts and all others are correctly kept, whether the 
condition of the bank corresponds therewith, and whether the bank is 



K ORGANIZATION. 121 

Minutes of the Meeting of Organization Board. 



122 BANK ORGANIZATION. 

in a sound and solvent condition, and to recommend to the board such 
changes in the manner of doing business, etc.. as shall seem to he desira- 
ble, the result of which examination shall be reported to the board 
at the next regular meeting thereafter. 

QUORUMS. 

29. A majority of the directors, including the president, (or in 
his absence the vice-president.) shall be a quorum to do business. 

AMENDMENTS. 

30. These by-laws may be changed or amended by the vote of two-. 
thirds of the directors. 

31. A copy of the by-laws of this bank as in force shall be kept 
in a convenient place in the bank, to which any stockholder shall have 
free access during the regular hours of business. 

32. Xo director is to endorse any accommodation paper that is to 
be discounted at this bank. 



BANKING ROOM AND FIXTURES. 

Banking Room. — It is needless to say that the banking room 
or building should be in as prominent a place as it is possible 
to place it, as position alone will be one of its main and strongest 
advertising features. 

Sice of Room. — The size of the banking room is not of such 
great importance. Of course, you should have a fair amount of 
floor space and any manufacturer of bank furniture will pre- 
pare blue prints for you, showing just how you have to arrange 
your fixtures to the best possible advantage, thereby economizing 
valuable space. 

For your guidance I might add that a fair sized room for 
the average country bank should be about 28 by 45 feet inside 
measurement, giving ample room for vaults, fixtures, etc. 

Temporary Quarters. — Should you decide to go into tem- 
porary quarters, you should purchase your fixtures from a firm 
that makes a specialty of that class of work, as they will make 
same in sections (knock down), so that when you are ready to 
move into your permanent quarters, all you will have to do is 
to add more sections so as to give you the required desk space, 
allowing you to use your old furniture, doing away with all waste. 

Fixtures. — In choosing your fixtures do not be too saving. 
You can not afford anything but the best, as your fixtures are 
one of the objects by means of which you must impress your 



M/.AT!' 12^ 

Minutes of the Meeting of Organization Board 



124 BANK ORGANIZATION". 

future patrons after you once get them into your banking room, 
for curiosity may tempt them to make an inspection of your 
bank and they will look for more elegance in your place than 
they would expect to see in the store on the opposite corner of 
the square, and they will judge the future success of the insti- 
tution by its appearance, and in banking, as well as in any other 
business, nothing " succeeds like success," and you will find you 
gain a patron, much sooner, if your visitor sees that you have 
good, substantial furnishings in your bank. Especially should 
you be well prepared to show him the preparations yon have 
made to safeguard any funds that he might place into your hands 
for safe keeping, and you should take especial care to show and 
explain to him your nest of Safe Deposit Boxes. 

Safe. — You should purchase the best and latest form of safes 
on the market. Just now those safes made out of manganese steel 
seem to have the best reputation, and you can advertise them 
without fear of adverse criticism. The writer has heard a Na- 
tional Bank Examiner praise a Bank Board for placing one of 
these safes into their vault, claiming the manganese safes to be 
the best safes on the market. 

Vaults. — Do not make the mistake that so many do in build- 
ing their vaults, but remember that the older your bank becomes, 
the more vault space you will require, and the only chance you 
will have to prepare for your future needs in this respect will 
be while you are putting up your building; therefore, do not 
be afraid of building it too large ; a vault should never be less 
than 8 feet inside measurement, and where space will permit, 
you ought to build it double length so as to have your Safe 
Deposit Department separate and distinct from your bank vault. 

After deciding on building a vault, get into communication 
with your Safe and Vault Houses and get them to send you blue 
prints, which they will be glad to do without making any 
charges for same. 



\\K 0R1 12.S 

Minutes of the Meeting of Organization Beard. 



126 BANK ORGANIZATION". 



THE SOVEREIGN STATES. 

The Sovereign States and Territories and the proper officials 
to whom requests for information concerning the organization of 
State Banks should be addressed : 

STATE. BANKING OFFICIALS. 

i . Alabama State Treasurer 

2. Alaska No Banking Laws or Officials 

3. Arizona (Territory) .Territorial Auditor (Bank Controller) 

4. Arkansas Secretary of State 

5. California State Board of Bank Commissioners 

6. Colorado Commissioner of Banking 

7. Connecticut Commissioners of Banking 

8. Delaware Insurance Commissioner 

9. District of Columbia . 

Comptroller of the Currency, Washington, D. C. 

10. Florida State Comptroller 

11. Georgia '. State Bank Examiner 

12. Hawaii (Territory) Territorial Treasurer 

13. Idaho Commissioner of Banking 

14. Illinois : . . State Auditor 

15. Indiana State Auditor 

16. Iowa State Auditor 

17. Kansas Commissioner of Banking 

18. Kentucky Secretary of State 

19. Louisiana State Bank Examiner 

20. Maine Bank Examiner 

21. Maryland State Treasurer 

22. Massachusetts Board of Bank Incorporation 

23. Michigan Commissioner of Banking 

24. Minnesota Public Bank Examiner 

25. Mississippi State Auditor 

26. Missouri Commissioner of Banking 

27. Montana Secretary of State 

28. Nebraska State Banking Board 

29. Nevada Board of Bank Commissioners 



i2; 
Minutes of the Meeting of Organization Board. 



[28 B WK ORG WIXATION. 

SPATE. BANKING OFFICIALS. 

30. New 1 [ampshire Bank Commissioners 

31. New Jersey Commissioner of Banking 

32. New Mexico State Auditor 

33. New York Superintendent of Banks 

34. North Carolina Corporation Commission 

35. North Dakota State Banking Board 

31 >. C )hio Superintendent of Banks 

37. Oklahoma Commissioner of Banking 

38. Oregon Bank Commissioners 

39. Pennsylvania Commissioner of Banking 

40. Rhode Island Commissioner of Banking 

41. South Carolina Secretary of State 

42. South Dakota Secretary of State 

43. Tennessee Comptroller 

44. Texas Superintendent of Banking 

45. Utah Secretary of State 

46. Vermont Commissioner of Banking 

47. Virginia Corporation Commission 

48. Washington Secretary of State 

49. West Virginia Comissioner of Banking 

50. Wisconsin Commissioner of Banking 

51. Wyoming State Bank Examiner 



[NDEX 



ACKNOWLEDQME 

te 
Ing bank 

i i 

ADVERTIJ on). 

X;i t i< in.i i bank .... 

101 

AQENT: 

n Inal Ion b 

i ;. erve 

'■■hi pal. 

Washin •• 
A M i 

Restrictions to 
A i I LICATH >NS 

itlonal bai 
UNTMENT 

■ 
l >n 

I 'lie 

Bpecia i examining commits • 
ARTICLES « >F .\^< iCIATK 

A :n. inl in. hi 

< ' . . 1 1 v .'i t.-.i state ban 

I '•niii 

Regular 

For converting bank i ' 

ESSMENTS: 

Shareholders' pers< nal liability I Ek 
ASSIGNMENT 

i". mi of, for temporary c< 
A UTH< >RITY: 

To appoint Board of Directors 

For conversion of state Into national 

Comptrollers, to commence the business of banking 

BANKING FACILITI1 

Are better banking facilities needed?. 
BANKING ROOM: 

Sise and location 

Temporary quarters 

BOARD OF DIRECTORS: rectors). 

Election of 

Temporary 

Permanent 

(129) 



i 3 o BANK ORGANIZATION. 

PAGE. 

Number, constituting- 32 

Sliding- scale 72 

Three-fourths to be residents of state 3 2 

BONDS: 

Amount required to secure circulation 102 

Annual examination 112 

Officers — 

Cashier 116, 8 

President 116, 9 

BRANCH BANKS: 

Laws relating to 22 

State banks converting, may retain 22 

BUSINESS: 

Authorization of association to begin 94 

Place of 122 

BY-LAWS: 

Form of 1 1 4 

CAPITAL STOCK: 

Amount required by national or state banks 28 

Amount paid in before beginning business 88 

Of branches of converted state banks 22 

Certificate of officers and directors relative to payment of — 

National 84, 88 

State 86 

Enforcing payment of 40 

Minimum amount required 28, 2 

Payment of, provision for 52 

Subscription List — 

Usual form 36 

Individual form 5 2 

Subscriptions to, when payable 52 

CASHIER: 

Appointment of 116, 7 

Election of .' 

Responsibilities of 116, 8 

CERTIFICATE: 

Comptroller's, of authority 94 

ORGANIZATION: 

Acknowledgment of 78 

Converting state : 18 

National 74 

Officers and directors relative to payment of capital stock 84 

Payments of installments, to be certified — 

National 8 8 

State 86 

Payments of capital stock, to be certified — 

Converted state bank 20 

National bank 84 

State bank 86 

Publication of authority to begin the business of banking 9 7 

CHARTER: 

Copy of 9 4 

Number 6 2 

Publication of — 

National 9 6 

State 98, 100, 101 



131 

CIRCULATE 

Amount obtainable 
i s. bond i 

CUMULATH i: \ i 

Wllilt M 

National .110 

i. 1 1" 

c i • R 1 1 1 

Amounl 106 

i'. s. i ■ 

Destruction III 

DIRE 

Appointim i • 

56 

Numbi i 
Nun 

80 
Proxy, can i . 108 

i 

National . 

s. i< 

Bliding 
Win ii dii 

an em po* ered I 

BLBCTK >N8: 

Directors' by shareholders . .in, l 

Qualification of din 108 

Qualication of Bhareholden to vob 108 

ENGRAVING I >F l LATE P< >R CURREN 
i of. . . 
i order for . 108 

i:\.\ MINATK >NS: 
Preliminary 
i low to make < flfecl lv< IS a* b, < 

FURNITURE AND FIXT1 

INSTRUCTIONS, COMPTROLLERS, AS TO H««\v TO FILL IN 

I tRGANIZATK >N PA] BRS 

Articles of association 

I organisation certificate 60 

l Oaths of tin 

Signatures of officers 60 

Certificate of officers and dir lative to payment of 

capita] stork 

neral instructions 

JUSTICE OF THE I BACE: 

Powers of B0, 90 



[3a BANK ORGANIZATION. 

PAGE. 

MEETINGS: 

St< ckholdera — 

Reg Mar 114, 1 

Special 114, 1 

MINUTES: 

Record of right hand page of book 

MOTH >NS: 

Made and carried in winding up affairs of organization board. . 56 
N< >TARY PUBLIC: 

Acknowledgment of organization certificate before 64 

knewledgment of different reports 6 4 

Duties and powers of 64 

I >ATHS: 

( lonverting bank 20 

National 80 

State No copy furnished 

OFFICERS: 

Bonds, where kept 116, 11 

Certificate of payment of capital stock 88 

Electionn or appointment of, by directors 114, 3 

Oaths, administration of 80 

OFFICIALS: 

Empowered to administer oaths of office and to receive ac- 
knowledgements 64 

Signature of officials of converting state banks 22 

Signature of national banks 82 

ORGANIZATION: 

Different methods — 

De Novo (new bank) 24 

Reorganization 22 

Conversion 10 

ORGANIZATION BOARD: 

Record of formation 7, 9 

Members of, and how to form 32 

ORGANIZATION CERTIFICATE: 

Acknowledgment of 78 

For converting state bank 18 

National bank 74 

FLATE CURRENCY: 

Capital stock, how made 52 

FLATE: 

Engraving, cost of 106 

PUBLICATON: . 

Application for state charter 98, 100, 101 

Certificate authorizing national banks to commence the busi- 
ness of banking 94, 96 

L.IMINARY EXAMINATIONS — (See examinations) 92 

1 low to be made effective 9 2 a, b, c, d 

PRESIDP_]NT: 

Duties of 116 — a 

Must be a director , .68, 6 

PRICE OF STOCK 52 

vernment's suggestion as to 52 a 

BCTUS: 

Form of 44, 46, 48, 50 

Value of 44 



*33 

PR< -XV: 

I - - 1 iii Ol 

Shareholdi rs 

who m 
QUALIF [CATIONS: 
D recfc rs — 

National 

te 

QU< >RUM 

L EBSTATB 

< * • .11 v. <-\ ance of 

I folding* of 

RD: 
Election of membt r and 
ini/.Mtion board 

st< ck 

i:i;- >R< I \ \ix.\ti< >N: 
Private bank 

State hanks 

im;si;k\ i: 



Cities 

SA1 i 

\\ h ; 1 1 tO PU1 

BELLING ST. .ck 

I low ;ni(l U !.■ I 

SHARES l 'i' ST( •<•!<: 

Allotment -38 

Number Ired to be h.-id — 

i : dlrectoi ol nal tonal bankui 

i \\ directors ol itate banl 

i \y dir. ctoi tate ban I 

BHAREHOLD] 

m. itlngs of ..114, l 

Record of 

SIGNATURE! 

Officials of converting state banks 

Officials Of national hanks 

Si >\ EREIQN STATES 

ST. H 

Comptroller's suggestions as to selling plan of 

List-form 

Autographic 

individual 

Usual 36 

Selling, instructions as to 

increase of 1 1 s . 1 ■» 

Price of 

Record 

Transfer of 120 

SUBSCRIPTION LIST: 

Autographic 

i ndividual form 

Usual form 

Why individual form is preferable 



i;,4 BANK ORGANIZATION. 

PAGE. 
TITLE: 

National 28 

Stat,' 28 

VAULTS: 

Size, etc 124 

VICE PRESIDENTS: 

Number of 9 

VOTING: 

Cumulative 110 

Power of shareholders 108 

Proxy 110 

Shareholders, when not eligible to vote .* 108 

WASHINGTON AGENTS: 

What they will do for you 112 



One copy del. to Cat. Div. 



